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‘World-Scale’ MEG Facility Planned For Dow’s Texas Gulf Coast Complex

Dow Chemical Co.’s Oyster Creek petrochemical complex south of Houston is adding a “world-scale” monoethylene glycol (MEG) manufacturing facility that is scheduled to be in operation by the middle of 2019, project developers said Tuesday.

The Oyster Creek MEG facility, to be built in Freeport, TX, would be the first U.S. manufacturing unit undertaken by Dubai-based MEGlobal. The proposed plant is expected to create 1,400 construction jobs at the project’s peak and employ about 50 full-time employees when it goes online.

“The Oyster Creek site provides MEGlobal with greater flexibility to satisfy our customers’ needs for consistent and reliable delivery of ethylene glycol products, especially in the growing U.S. and Asian markets,” said MEGlobal International FZE President Ramesh Ramachandran.

Additionally, the new site would benefit through a long-term ethylene supply agreement with Dow from its cracker now under way at the site (see Daily GPI, June 25, 2014).

MEG is used in many market applications, including polyester fibers, polyethylene terephthalate bottles and packaging, antifreeze/coolants, paints, resins, deicing fluids, heat transfer fluids and construction materials.

MEGlobal, a subsidiary of Equate Petrochemical Co., now manufactures more than 1 million metric tons/year of ethylene glycol at three Canadian manufacturing plants in Fort Saskatchewan and Prentiss, AB. It also markets more than 3.5 million metric tons/year from its supply partners.

Equate is an international joint venture of Dow, Petrochemical Industries Co. (PIC), Boubyan Petrochemical Co. and Qurain Petrochemical Industries Co.

“Establishing MEG production in the U.S. Gulf Coast is an important investment for us as it greatly enhances our global footprint and is directly aligned to our growth strategy to maximize value as a leading ethylene glycol producer and supplier,” said Equate CEO Mohammad Husain.

The “ethylene producer economics through a long-term supply agreement with Dow provide a unique competitiveness for the production plant,” he said.

PIC CEO Mohammed Abdullatif Al-Farhoud said the U.S. Gulf Coast investment “fits the diversification and growth strategy of PIC.” He added that Equate was continuing to prowl for “opportunities in the petrochemical area across the globe to expand our footprint and diversify our portfolio.”

Construction continues to progress at the Dow ethylene plant in Freeport (see Daily GPI, June 25, 2014), with the cracker more than 40% complete and on track to ramp up in mid-2017. Dow also has plans on the drawing board to add ethane feedstock flexibility for an ethylene cracker at its Louisiana operations site, which is scheduled to begin operations later this year.

Dow restarted an ethylene cracker in 2012 at its St. Charles, LA, site, and in December began operating a propane dehydrogenation unit (see Daily GPI, Dec. 18, 2015).

The MEGlobal announcement “is in line with Dow’s strategy to integrate with cost-advantaged production that will ultimately enable growth in attractive markets across North and South America,” said Dow Senior Vice President Brian Ames, who heads Portfolio Development for Feedstocks and Performance Plastics. “With decades of operability in mind, Dow continues to track aggressive timelines and harness our first-mover advantage in the region, resulting in positive economic benefits even in a low-oil environment.”

The Freeport petrochemical site is Dow’s largest integrated manufacturing facility and its largest single chemical complex in North America. The Texas facilities manufacture 44% of the Midland, MI-based operators’ U.S. products and more than 20% of its global products.

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