PetroLogistics Making Significant Progress on Conversion of Former ExxonMobil Ethylene Plant in Texas

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Researched by Industrial Info Resources (Sugar Land, Texas)--PetroLogistics LLC (Houston, Texas) appears to be making good progress on the conversion of a former ethylene plant in Houston, Texas, that it purchased from ExxonMobil (NYSE:XOM) (Irving, Texas) more than a year ago. PetroLogistics has demolished and removed the furnace section of the plant and plans to install new propane dehydrogenation technology called Lummus CATOFIN technology to produce an estimated 554 million metric tons per year of propylene.

Construction on this project began last fall under the direction of S&B Engineers and Constructors Limited (Houston), which has been hired as the project's engineering, procurement and construction/management contractor. PetroLogistics is expected to spend an estimated $300 million to convert the former ExxonMobil plant and utilize many of the existing ethylene plant's infrastructure and pipeline connections to produce and market propylene to the Gulf Coast markets.

This project comes along at a time when many of the chemical giants along the Texas and Louisiana coast are cutting cost, postponing projects or canceling them entirely. This project is one of only a handful of projects along the Gulf Coast region of this size at the moment. Construction for this project began just as the local markets were beginning to feel the effects of the globally slowing economy. Expected to be complete early next year and online by spring 2010, the timing of this capacity could be available when many feel the Chemical Processing Industry will be rebounding.

Propylene is generally consumed as a chemical intermediate used to manufacture other chemicals and is the building block for many common chemicals such as polypropylene, isopropyl alcohol and many others. Propylene is most often produced in a petroleum refinery or petrochemical plant in either chemical or polymer grades. This new plant will be one of only a few producing large quantities of propylene from propane or independent from a refinery or chemical plant. PetroLogistics operates several regional pipelines and is expected to serve the Texas and Louisiana markets with this capacity once complete next year.

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