Occidental Petroleum Seeks to Build Texas Ethylene Plant

Occidental Petroleum Corp. (OXY) applied to build an ethylene plant in Texas, the latest company to propose new capacity for the region as booming shale gas supplies cut costs for U.S. chemical makers.

The plant in Ingleside near Corpus Christi would have the capacity to produce 1.2 billion pounds a year of ethylene, Los Angeles-based Occidental said in an application to the U.S. Environmental Protection Agency. Construction would start in December 2014 with production beginning in February 2017, according to the application on the EPA’s website. The plant would create 123 jobs.

Occidental, the largest onshore crude-oil producer in the continental U.S., is also the world’s biggest maker of vinyl chloride. It plans to use some of the ethylene from the Ingleside project to make vinyl chloride monomer, an ingredient in vinyl products, at an existing plant nearby. Vinyl is used in items such as PVC pipe and vinyl siding.

Dow Chemical Co. and Chevron Phillips Chemical Co. are among other chemical producers who have proposed plants to make ethylene from natural gas liquids such as ethane, the price of which hit a multiyear low last month. Hydraulic fracturing, also known as fracking, has increased supplies of NGLs, which are converted to ethylene used in plastics, antifreeze and hundreds of other applications.

Melissa Schoeb, an Occidental spokeswoman, didn’t immediately respond to a request for additional details of the proposed plant.

To contact the reporter on this story: Jack Kaskey in Houston at jkaskey@bloomberg.net

To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net

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