Ingleside Ethylene LLC, a 50/50 joint venture of Occidental Chemical Corp. (OxyChem), and Mexichem, S.A.B. de C.V. said its new its ethylene cracker at OxyChem’s Ingleside, TX, complex has begun operations on schedule and on budget.

The cracker is currently in a production stabilization phase. The unit will be operated by OxyChem and has capacity to produce 1.2 billion pounds (550,000 cubic meters) of ethylene per year and provide OxyChem with an ongoing source of ethylene for manufacturing vinyl chloride monomer, which Mexichem will use to produce polyvinyl chloride (PVC) resin and PVC piping systems. The companies have a 20-year supply agreement. Their joint venture was formed in 2013. Construction began almost three years ago.

“This is a significant milestone for both OxyChem and Mexichem, enabling us to capitalize on the advantages that shale gas development presents for the chemical industry. It also helps our companies better compete globally in our respective markets, and gives us an inherent advantage to manage the cost of ethylene,” said OxyChem President Robert Peterson.

The project also includes a pipeline and storage facility at Markham, TX. Total investment in the project was $1.5 billion and the facility will provide 150 permanent jobs.

“For Mexichem, the ethylene plant is a vital part of our global strategy to become a vertically integrated specialty chemicals company with a focus on high-end products,” said Mexichem CEO Antonio Carrillo.