More than $5.4 Billion in Capital Polypropylene Projects Make Progress in U.S., Canada

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Researched by Industrial Info Resources (Sugar Land, Texas)--When it comes to polypropylene, there's no paucity of projects in the pipeline. Industrial Info is tracking well over $66 billion worth of capital polypropylene projects in various stages of development across the globe.

With $51 billion worth of polypropylene projects, Asia dwarfs all other regions, driven mainly by China's appetite for the plastic to help meet its manufacturing needs. However, North America is no slouch in this sector, with more than $5.4 billion in project activity.

Click on the image at right for a chart showing capital polypropylene project activity by world region.

The global market for polypropylene is expected to grow at a compound annual growth rate (CAGR) of 5% until 2022, reaching $115 billion in that year, according to market research firm Beroe Incorporated (Raleigh, North Carolina).

In the U.S., polypropylene production capacity is set to grow by 10 billion pounds per year by 2023, according to Industrial Info's July 18 2019-2020 Global Chemical Processing Outlook webinar presentation.

On Monday, Braskem S.A. (NYSE:BAK) (Sao Paulo, Brazil) said mechanical construction on its Delta polypropylene production line in Texas was 75% complete. The $675 million project remains on target for completion in 2020, the company said, adding the 450,000-metric-ton-per-year unit will be the largest polypropylene production facility in the Americas.

Industrial Info has tracked the Braskem project since 2015. Located at an existing polypropylene plant in La Porte, Texas, construction of the unit kicked off in late 2017. The unit will use W.R. Grace and Company's (NYSE:GRA) (Columbia, Maryland) UNIPOL technology. Linde (Dublin, Ireland) is providing engineering, procurement and construction (EPC). For more information, see Industrial Info's project report and see April 6, 2018, article - Braskem Pushes Ahead with U.S. Polypropylene Plant Project, Boosts CAPEX.

"As production begins in the first half of 2020, Braskem will be well placed to address the shortfall in (the) U.S. domestic polypropylene market, which is currently being served by imported product," said Braskem North America Executive Vice President Mark Nikolich in a press release. "Delta will also directly support Braskem's global export capability to clients throughout North America, South America, Europe and Asia."

Braskem isn't the only company in the U.S. with big polypropylene plans. In Baton Rouge, Louisiana, Exxon Mobil Corporation (ExxonMobil) (NYSE:XOM) (Irving, Texas) has begun construction on a 900 million pound-per-year (408,000-metric-ton) unit as part of the company's "Growing the Gulf" initiative. WorleyParsons (North Sydney, Australia) is providing engineering and procurement for the project, which is planned for completion in mid-2021. For more information, see Industrial Info's project report and March 11, 2019, market brief - ExxonMobil to Add Polypropylene Unit in Baton Rouge.

The shortfall in domestic polypropylene capacity occurred when U.S. chemical producers stopped yielding polymer-grade propylene as they moved to lighter feedstock, said Trey Hamblet, Industrial Info's vice president of Chemical Processing Industry research, during the 2019-2020 Global Chemical Processing Outlook webinar. Changes in the U.S. refining industry also resulted in less polymer-grade propylene, leading to the need for more propane dehydrogenation units to fill the gap.

In the U.S., Industrial Info is tracking seven propane dehydrogenation (PDH) projects that will produce propylene, which in turn will be processed into polypropylene. For more information, see September 27, 2019, article - Enterprise Products Presses Ahead with Second PDH Project, LyondellBasell Shelves Own U.S. PDH Plans.

Canada also features significant project activity in this sector. In Redwater, Alberta, Canada Kuwait Petrochemical Corporation, a joint venture of Pembina Pipeline Corporation (NYSE:PBA) (Calgary) and Petrochemical Industries Company (PIC) (Kuwait), plans to start construction early next year on a grassroot PDH and polypropylene plant, which would consume 23,000 barrels per day of propane to be processed into 550,000 metric tons per year of polypropylene. For more information, see Industrial Info's project report and February 5, 2019, article - Pembina Makes Positive Final Investment Decision for Propane Dehydrogenation and Polypropylene Complex.

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.