Mexichem/Occidental in jv for ethylene cracker

Mexican chemicals company Mexichem is proceeding with plans to build a US$1.5 billion 550,000 tonne/year-ethylene cracker in Texas, US, in a joint venture with Occidental Chemical Corp, a unit of Occidental Petroleum Corp. The plans are a result of a feasibility study undertaken by the partners.

The plant will be located at Oxychem's Ingleside, Texas site, and the two companies will each have a 50% stake in the joint venture company known as Ingleside Ethylene.

Most of the ethylene produced by the cracker will be used by Oxychem to produce vinyl chloride monomer (VCM), a raw material used in the production of PVC. This will be supplied to Mexichem, whichis a major producer of PVC plastic pipes.

Mexichem expects to take advantage of the shale gas boom in the US, which has lowered natural gas prices, while securing long-term supplies for its PVC business. Oxychem will build and operate the cracker, which is planned for mid-2014, with the plant expected to start operations in early 2017.


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