Braskem Gives Green Light to Billion-Pound PP Project

Braskem SA is moving forward with plans to build a massive new polypropylene resin line in La Porte, Texas.

The project — named Delta — will include a production line with annual PP capacity of almost 1 billion pounds, officials said in a June 22 news release. It represents an investment of up to $675 million for Braskem, which is based in São Paulo with North American headquarters in Philadelphia.

Officials said that the new line will be the largest PP production line in the Americas. It will be located next to Braskem's existing production facilities in La Porte. Construction is set to begin later this year, with completion expected in early 2020.

"Delta is the latest major milestone in Braskem's global growth strategy," CEO Fernando Musa said. "This new world-class petrochemical facility will bring important new North American production capacity to help us meet the growing demand from our clients, reaffirming our position as the leading producer of polypropylene in the Americas and the third largest in the world."

He added that the new line will leverage shale gas feedstocks in the region. "North America has among the most attractive feedstock profiles worldwide in terms of access to low cost sources of feedstock and the depth of suppliers," Musa said.

"With no new polypropylene plants added since 2005, North America also transitioned to being a net importer of polypropylene in 2016," he added. "As such, our additional investment in the United States is a logical extension of our global growth strategy."

The new line will make several types of PP resin, including homopolymers, random copolymers, impact copolymers, and reactor TPOs. Braskem already operates almost 800 million pounds of annual PP capacity in La Porte.

The project is expected to create 1,000 temporary construction jobs and 50 permanent jobs. Officials said it also will benefit from existing support infrastructure, including feedstock and utilities, rail, testing facilities, emergency response equipment and waste treatment facilities.

Braskem operates six PP plants in the United States — in Texas, Pennsylvania and West Virginia — as well as Innovation and Technology Center in Pittsburgh.

The Braskem announcement is the largest yet for PP related to North America's natural gas boom. Many more polyethylene resin expansions have been announced, since natural gas-based ethane produces less propylene feedstock than crude oil-based naphtha.

Some PP moves have been made, however. The North American market is expected to add between 500 million and 700 million pounds of new capacity through debottleneckings in 2016-17. Formosa Plastics Corp. USA also plans to add 550 million pounds of annual capacity in Point Comfort, Texas, in 2019,

New propylene capacity via propane dehydrogenation could provide a basis for future PP expansions. Enterprise Products is adding 1.6 billion pounds of annual capacity in Mont Belvieu, Texas, in July, while Sunoco Inc. is expected to add 1.4 billion pounds in Marcus Hook, Pa., in 2019.