Chevron Phillips Chemical may build a steam cracker and at least one derivative unit in far southeastern Texas, according to documents filed with the Texas Comptroller's office.
The company is evaluating whether to buy a 1,700-acre project site near Orange, Texas, as the location for a cracker, one or more derivative units, administrative buildings, utility and logistics infrastructure and other improvements necessary to operate the production facilities, according to the documents. The complex is estimated to cost about $5.8 billion.
The company did not reveal capacities for the plants or further details in the documents, which are applications for property tax breaks from school districts. Such requests are common as companies seek economic advantages when evaluating potential locations for new projects.
"The impact of property taxes on the economic return is a major factor in the site selection process," the documents said. "The project is in the evaluation stage; only very preliminary development activities have begun."
CP Chem also is evaluating other proposed sites in Texas and Louisiana, the documents said.
Phillips 66 operates facilities owned by CP Chem, a joint venture of Phillips 66 and Chevron.
Phillips 66 executives have said multiple times since 2016 that the company was planning another cracker, with a final investment decision likely in 2019 or 2020.
The documents filed in January with the comptroller's office said that if the company moves ahead on the project, construction would likely start in 2020, followed by startup in 2024.
CP Chem started up a 1.5 million mt/year cracker at its Cedar Bayou complex near Baytown, Texas, about a year ago after severe flooding from Hurricane Harvey in August and September of 2017 forced delays. The company also started up two 500,000 mt/year polyethylene plants about 85 miles away in Sweeny, Texas, in September 2017.
Those plants are among an additional eight crackers and 13 PE plants starting up in 2017-2019 in the first wave of petrochemical infrastructure to emerge from the use of cheaper ethane feedstock tapped by the US natural gas shale boom. A second CP Chem cracker and one or more derivative units would be part of a second wave, with startups beyond 2020.
