LyondellBasell has broken ground near Houston for the world’s largest propylene oxide (PO) and tertiary butyl alcohol (TBA) complex ever built and the company’s largest investment to date, a project that would be fueled by Lower 48 natural gas.

The estimated $2.4 billion project, launched last year, should be able to produce up to 1 billion pounds/year, or 470,000 metric tons/year (mmty) of PO and 2.2 billion pounds (1 mmty) of TBA. Startup is planned for 2021.

“This plant will be the largest of its kind, built to meet the rising global demand for urethanes used by billions of consumers each day and clean-burning oxyfuels that will help improve air quality around the world,” said CEO Bob Patel. “The construction of this project will provide jobs for our neighbors, support local businesses and strengthen our communities with increased tax revenues across the greater Houston region.

“As one of the cornerstones of our global growth strategy, the new plant will strengthen our ties in Houston and generate long-term value for our shareholders.”

To optimize product balances and realize synergies between LyondellBasell sites in the Houston area, two facilities are being constructed on existing manufacturing sites. The 140-acre PO/TBA plant is underway at the LyondellBasell Channelview Complex east of Houston, while an associated 34-acre ethers unit to convert TBA to oxyfuels is being built at the Bayport Complex in Pasadena, which is southeast of Houston. Both sites have access to the Houston Ship Channel (HSC).

The projects are are using the existing locations along the Gulf Coast because of “their proximity to low-cost feedstocks and the transportation infrastructure needed to ship products to markets around the globe,” management said.

“The groundbreaking on this new project not only brings more job opportunities for Texans, it also adds to the growing diversity of our booming economy,” said Texas Gov. Greg Abbott.

Based on an analysis by the Greater Houston Partnership, LyondellBasell’s PO/TBA project is expected to generate over a 10-year period more than $453 million in tax benefits for the county, school district, community college and other local taxing districts.

The Channelview site is expected to deliver $349 million in tax benefits, and the Pasadena site is expected to create $104 million in benefits.

The project is set to create more than 2,200 construction jobs at the peak of construction and 160 permanent positions.

PO is used to make bedding, furniture, carpeting, coatings, building materials and adhesives, while TBA would be converted to two ether-based oxyfuels, methyl tertiary butyl ether (MTBE) and ethyl tertiary butyl ether (ETBE). Both MTBE and ETBE are high-octane gasoline components that reduce emissions from automobiles.

Global demand for urethanes is projected to grow by 4-5% over the next five years because of increasing demand from emerging economies in Asia and India. The global TBA market is expected to increase by 3% a year between 2018 and 2028, as drivers and governments in Asia Pacific and Latin America seek to improve air quality with cleaner-burning gasoline.

LyondellBasell plans to sell the PO and derivative products to U.S. and global customers, while the oxyfuels primarily would be sold in Latin America and Asia. Most of the products are to be exported via the HSC.

The project is part of LyondellBasell’s $5 billion organic growth program on the U.S. Gulf Coast. It recently completed ethylene expansion projects at its La Porte, Channelview and Corpus Christi sites in Texas, finalizing a multi-year plan to increase ethylene capacity in the United States by 2 billion pounds/year (900,000 mmty). Additionally, LyondellBasell is constructing a world-scale polyethylene (PE) plant at its La Porte Complex southeast of Houston, which would more than double that site’s PE capacity to 2 billion pounds/year (900,000 mmty).