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Shell starts up big, new Gulf Coast petrochemical unit

The Gulf Coast has become home of one the largest producers of a common plastic: Shell fired up its fourth alpha olefins unit at its chemical plant in Geismar, Louisiana, the company said Monday.

The multi-billion dollar expansion adds 425,000 metric tons per a year in capacity to the chemical manufacturing site, bringing its total alpha olefin production up at Geismar to more than 1.3 million metric tons per a year. That makes it the largest alpha olefins producing site in the world, the company said.

Alpha olefins are key ingredients in consumer goods such as laundry detergents, motor oils and hand soaps.

The project represents a major expansion of Shell’s petrochemical business in the region, and will add demand to support the Deer Park facility in the greater Houston area.

The new unit is part of Shell’s push to integrate the downstream side of its business. The company said the Geismar site is supported with advantaged ethylene feedstock from Shell’s nearby Norco, Louisiana and Deer Park, Texas manufacturing sites, enabling the site to respond to market conditions.

EARLIER: Shell reaches milestone on plastics plant in Northeast, potentially a Gulf competitor 

The unit started up in December but the Houston-based U.S. operations of Shell announced the startup Monday.

“Our team delivered this world-class expansion project safely, on time and within budget,” said Graham van’t Hoff, Executive Vice President for Shell’s global chemicals business in a statement.

“This is a key growth project for Shell’s global chemicals business. Geismar will continue to play a leading role in providing the materials for products that an increasing number of people need and enjoy,” he added.

The Geismar chemical site near the Mississippi River is used in the production of stronger and lighter polyethylene plastic for packaging and bottles, as well as engine and industrial oils and drilling fluids, according to the company.

Shell announced its final investment decision in the project in November 2015 and construction kicked off in 2016.The project included re-purposing an idled tank farm, significantly expanding railway inside the plant and a new water cooling tower. The project took 3,570 metric tons of steel, 18,290 meters of concrete and 85 linear kilometers of pipe to build, according to a Shell announcement.

Shell’s chemical business is already considering another expansion project for the Geismar plant, according media reports. Shell is reportedly in the early evaluation stage of a $1.2 billion expansion of a project that would add a “world scale” mono-ethylene glycol unit to the Geismar site, The Advocate reported.

Meanwhile,  the oil major also is building out a plastic chemical complex in Pennsylvania. The company is building an ethane cracker there, which processes the natural gas liquid ethane into ethylene, which will be the feedstock for on-site production of polyethylene, the world’s most common plastic.

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