Hurricane Katrina Delays Degussa’s Gulf Coast MMA Expansion Plans

---

Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). Degussa Corporation (Parsippany, New Jersey), a subsidiary of Degussa AG (Dusseldorf, Germany), has been steadily moving forward with plans to increase MMA (methyl methacrylate) capacity by 20,000 metric tons per year in either Louisiana or Alabama. This project has an estimated total investment value (TIV) of $20 million and will include a new MMA plant to be located in either Westwego, Louisiana at the existing Cytec Industries (West Paterson, New Jersey) Fortier plant site, or at a grassroot plant site in Mobile, Alabama. The Fortier plant, which is currently attempting to resume production after being shut down prior to the hurricane, is located across the Mississippi River just South and West of New Orleans in Jefferson Parish. The Fortier plant received some wind damage, but no flooding as a result of the hurricane.

Prior to hurricane Katrina, the primary focus had been selecting a site and obtaining approvals for this new plant, with plans for construction to begin in the first quarter of 2006. Degussa is evaluating its options and the delays that the recent hurricane will potentially cause on expansion plans.

Degussa is currently finalizing a potential $95 million acquisition of an existing MMA unit currently in operation at Westwego, Louisiana and operated by Cytec Industries. Degussa currently owns 50% of this MMA unit through a joint venture with Cytec called CYRO Industries and hopes to acquire the remaining 50% of ownership in the unit through this acquisition. When this transaction is complete, Cytec is expected to continue operating the unit under contract for Degussa.

Degussa is waiting for all acquisition details to be complete before moving ahead with plans for a debottleneck of the existing MMA unit located in Westwego. Industrialinfo.com originally reported plans for this nearly $3 million debottleneck in 2001. Prior to hurricane Katrina’s devastation of the New Orleans area, the debottleneck was scheduled to begin construction this month and be complete by early 2006. When construction will begin now is unknown and when complete, MMA production is planned to increase from 145,000 metric tons per year to 170,500 metric tons per year. These two projects are expected to increase Degussa’s overall global MMA capacity to 500,000 tons per year when completed.

View Plant Profile - 1000092
View Project Report - 02005720 02004569

Industrial Information Resources (IIR) is a Marketing Information Service company that has been doing business for over 22 years. IIR is respected as a leader in providing comprehensive market intelligence pertaining to the industrial processing, heavy manufacturing, and energy-related industries throughout the world.