DowDuPont Sees Sales Grow on Capacity Expansion Projects

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Researched by Industrial Info Resources (Sugar Land, Texas)--Having completed more than $2.8 billion worth of chemical projects along the U.S. Gulf Coast during the past couple of years, as well as $5.9 billion worth via its Sadara joint venture in Saudi Arabia, DowDuPont Incorporated (NYSE:DWDP) is enjoying the fruits of its labor.

Click on the image at right for a graph showing U.S. DowDuPont projects being tracked by Industrial Info.

The company recently reported a 5% rise in first-quarter net sales to $21.5 billion from a year earlier, driven by its Materials Science and Specialty Products divisions, which were supported by new capacity additions on the U.S. Gulf Coast and increased production by its Sadara joint venture with Saudi Arabian Oil Company (Saudi Aramco).

The company's new world-scale ethane cracker and polyethylene train in Texas each ran at high rates through the first quarter and contributed to the company's bottom line, Chief Financial Officer Howard Ungerleider told analysts during DowDuPont's earnings conference call. For more information, see Industrial Info's reports on the 3.3 billion-pound-per-year ethylene unit addition and 400,000-metric-ton-per-year linear low density polyethylene unit addition, both in Freeport, Texas.

During the earnings conference call, James Fitterling, chief operating officer of the Materials Science Division, appeared to shrug off concerns over the potential impact of a trade war between the U.S. and China. Both countries are threatening to ramp up import tariffs on a number of items, including chemical products.

"I don't think we're looking at a major trade war here ...I think some of that's been overplayed," Fitterling said. "I think people have got us in the crosshairs on the trade war thing and I don't think that's what's going to happen. So nothing's been imposed at this time that's having a dramatic impact on us.

"And remember, we have global assets to cater to the demand in China. The whole reason we built Sadara was to serve the eastern part of the world and so that's what's happening today."

He added that the company's U.S. Gulf Coast production buildup is aimed at serving North America.

Looking to the future, company executives said emphasis will be placed on debottlenecks and incremental expansions.

Industrial Info is tracking more than $1.6 billion in active DowDuPont projects along the Gulf Coast. This includes plans for a 1.1 million-pound-per-year ethylene unit expansion at the company's Oyster Creek Chemical site in Freeport. Construction kickoff is planned for this year, with completion in late 2019. For more information, see Industrial Info's project report.

Also in Freeport, construction of the 650,000-metric-ton-per-year Plant B low density polyethylene unit addition is underway, with completion expected in late 2018. Fluor Corporation (NYSE:FLR) (Irving, Texas) is the mechanical contractor. For more information, see Industrial Info's project report.

The company is evaluating a new potential polyethylene unit, also in Freeport, that could see completion in 2025. For more information, see Industrial Info's project report.

DowDuPont was formed by the merger last year of Dow Chemical and DuPont. The company plans to split into three publicly traded companies, with focuses on agriculture, materials science and specialty products.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.