Lotte, LACC break ground on $3-billion Louisiana petchem project

South Korea’s Lotte Chemical Corp. and LACC LLC, Atlanta, a subsidiary of Axiall Corp. and Lotte Chemical USA Corp.’s 50–50 joint venture Eagle US 2 LLC, have started construction on a long-planned grassroots petrochemical project in southwest Louisiana (OGJ Online, Dec. 18, 2015; Feb. 11, 2014).

Lotte and Axiall held a groundbreaking ceremony on June 14 for LACC’s proposed $1.9-billion ethane cracker complex and Lotte’s associated $1.1 billion monoethylene glycol (MEG) plant, both of which are to be built on the same property in Lake Charles, La., near Axiall’s existing manufacturing plants in Calcasieu Parish, Louisiana Economic Development (LED) said.

The groundbreaking ceremony follows months of site preparation on about 250 acres just west of Axiall’s Lake Charles chloralkali chemical plant, which will allow the new petrochemical complex to take advantage of existing infrastructure, access to competitive US shale feedstock resources, and ethylene distribution infrastructure (OGJ Online, June 18, 2015; Dec. 20, 2013).

With full construction now under way, the cracker and MEG plant remain on schedule for startup in early 2019, LED said.

LACC has let a series of contracts to CB&I, Houston, for the project, including a $1.3-billion contract to provide engineering, procurement, fabrication, and construction for the ethane cracker, which will use CB&I’s proprietary SRT cracking heaters as well as its recovery section design to produce 1 million tonnes/year of ethylene (OGJ Online, Dec. 18, 2015).

CB&I also was engaged to deliver detailed engineering and early procurement services on the cracker after previously providing front-end engineering and design and other early-stage engineering works for the project (OGJ Online, Sept. 3, 2015).

Lotte subsidiary Lotte Chemical Louisiana LLC separately has let contracts to CB&I to provide construction planning and reviews, early works services, and construction services for the proposed MEG unit, which once completed, will be the largest in the US (OGJ Online, Dec. 22, 2015; Oct. 30, 2015).

Previously slated to have a production capacity of 600,000 tpy, the MEG plant—now will be able to produce 700,000 tpy of MEG for export to destinations in Europe and Asia, LED said.

The start of construction on the $3-billion petrochemical project comes immediately in the wake of Axiall’s June 10 merger agreement with Westlake Chemical Corp., Houston, under which Westlake will purchase all of Axiall’s outstanding shares for $33/share in an all-cash transaction, or about $3.8 billion (OGJ Online, June 10, 2016).

Contact Robert Brelsford at rbrelsford@ogjonline.com.

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