Total SA (FP), Europe’s third-biggest energy producer, may add petrochemical capacity at its 174,000 barrel-a-day refinery in Port Arthur, Texas, to convert low- priced natural gas into more valuable chemical products.
Installing petrochemical capacity at Port Arthur would add to the $2.2 billion spent upgrading the refinery to take heavier crude, Patrick Pouyanne, the company’s president of refining and chemicals, said today in an interview.
The upgrade was the largest investment Paris-based Total has made in refining in five years, Pouyanne said in an interview at CERAWeek, a Houston conference held by IHS Cambridge Energy Research Associates. He declined to give a timeline or potential cost.
The Port Arthur expansion would represent another petrochemical investment seeking to wrest more value from natural gas prices that have reached the lowest point since at least 2006, according to data compiled by Bloomberg. Royal Dutch Shell Plc. plans to build a plant to produce ethylene and related plastics in Appalachia.
Total is considering a similar expansion at its $10 billion plant at Jubail in Saudi Arabia built with the Saudi Arabian Oil Co., or Aramco., he said. The French company remains in “preliminary talks” with Kuwait Petroleum Corp. in an effort to help build a 300,000 barrel-a-day, $10 billion refinery for China Petroleum (386) and Chemical Corp., Pouyanne said.
Total has abandoned plans to sell its Lindsey refinery in the U.K. after failing to find a buyer, he said.
“The increasingly difficult market conditions have resulted in the fact that we have not received sufficiently attractive offers to sell the refinery,” Michael Crochet- Vourey, a Total spokesman, said in an e-mail message. “The refining asset sale process has been long and difficult for the local teams.”
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