Qatar Petroleum Joins CPChem in US Complex
Less than a month after signing a deal to construct a major petrochemicals complex in Qatar, state-run Qatar Petroleum (QP) and Chevron Phillips Chemical (CPChem) have agreed a second venture, this time in the US.
The companies are partnering on CPChem’s plans for another ethylene/PE complex on the US Gulf Coast, where there is direct access to significant ethane feedstock from shale basins, including the prolific Permian Basin.
CPChem started up its first US Gulf Coast (USGC) project at Cedar Bayou, Texas, in 2018. USGC includes a 1.7 million t/y ethane cracker and two 500,000 t/y PE plants.
In this latest project, dubbed US Gulf Coast II Petrochemical (USGC II), QP will own 49% and CPChem will own 51%. The US-based firm will also provide project management and oversight and be responsible for operating and managing the facility once built.
At an estimated cost of around $8 billion, the proposed complex will comprise an ethane cracker with an ethylene capacity of 2 million t/y - the largest in the world, according to the companies – along with two hdPE units, each with a capacity of 1 million t/y.
Saad Sherida Al-Kaabi, Qatar’s Minister of State for Energy Affairs and president and CEO of QP, said this second agreement with CPChem further cements the strong partnership between the two companies and complements QP’s international portfolio in the US, a core growth area for QP and one with “great prospects and growth opportunities”.
A final investment decision will be taken no later than 2021. The companies are currently planning to award engineering, procurement and construction (EPC) contracts in 2021 and are targeting start-up in 2024, which is a year before their Qatari jv. The complex at Ras Laffan Industrial City will consist of a 1.9 million t/y ethane-fed ethylene plant and downstream PE plants. QP is taking 70% in this project with CPChem owning 30%.
CPChem already owns 49% in two other jvs with QP (and Mesaieed Petrochemical Holding) at Mesaieed in Qatar, namely Q-Chem and Q-Chem II.
Just last month, CPChem offered to buy Canada’s Nova Chemicals for more than $15 billion, according to Reuters news agency.