US CP Chem seeks incentives for proposed cracker, downstream unit
February 6, 2019
US-based Chevron Phillips Chemical (CP Chem) is seeking tax incentives for a possible cracker and at least one downstream unit in Orange County, Texas, according to government documents.
The company did not specify the capacity of the units, but it said that the cracker would be worldscale.
Likewise, it did not specify the downstream units. However, CP Chem said that the ethylene produced at the new cracker would be used by other units to make polyethylene (PE) used to make plastic pipe, plastic bags and rigid packaging such as milk jugs, pails and bottles.
If the company decides to pursue the project, construction could start in the second quarter of 2020 and commercial operations could start in the third quarter of 2024, the documents said.
Chevron Phillips applied for tax-incentive programmes from multiple government entities. One application was filed with the Bridge City school district. It estimates that the value of the project is $2.55bn. Another application was made to the West Cove-Orange school district, and it seeks incentives for an additional $2.55bn worth of the value of the proposed project.
The applications to the Bridge City and West Cove-Orange school districts did not reveal the total value of the proposed project.
Right now, the company is evaluating whether it will buy a 1,700 acre (690 ha) parcel for the project. It is considering other locations as well.
CP Chem stressed that the project is in the evaluation phase, and the work so far has been preliminary.
It has not announced a final investment decision (FID).
Phillips 66, one of the company’s joint venture partners, discussed the project during conference calls in 2018.
In a statement, Chevron Phillips Chemical said, “We have formed a team to study the scope and options for a potential new project. However, it would be premature to discuss specifics.”
It added that the Orange site is a finalist that is undergoing due diligence. “The location is only one of the alternatives we are considering along the US Gulf Coast. As in the past, we would expect to make a public announcement upon a final investment decision.”
Source: ICIS News