14-12-2017

INEOS Oligomers to build new world scale PAO plant in Texas

Today, INEOS Oligomers announced it had made the Final Investment Decision to build a new world scale, low viscosity Polyalphaolefin (PAO) unit on the INEOS site at Chocolate Bayou, TX.  This unit will have a capacity of 120 thousand metric tons per annum (ktpa) and become the world’s largest single PAO train. The plant is scheduled to start-up in 3Q 2019. The new PAO unit will obtain its feedstock from the adjacent Linear Alpha Olefin (LAO) plant, which is currently under construction at the same site. This investment represents a major step forward in the ambitious growth plans for the INEOS Oligomers PAO business, complementing existing units in La Porte, TX and Feluy, Belgium.

“Our low viscosity PAO business continues to benefit from lubricant reformulation activity to both attain better fuel economy and to lower carbon emissions. The size of this new PAO unit underscores our commitment to keep pace with our customers’ expanding requirements, well into the next decade.  INEOS Oligomers is currently the world’s largest merchant supplier of low viscosity PAO and this investment will ensure we maintain that position” said Joe Walton, Business Director, INEOS Oligomers.

“INEOS Oligomers already has a worldwide network of PAO production trains and bulk storage locations. The addition of another new unit, in a new location, further increases the robustness of our global supply chain. This capability can offer advantages versus competing lubricant base oils that may sometimes come from a single production source.” Walton added.

“Our customers have told us that they value our back integration into the manufacture of Linear Alpha Olefin (LAO), the raw material for PAO production. Our existing LAO units in Joffre, Canada and Feluy, Belgium produce the feed for our current PAO capacity. In addition, we are currently building a new world scale, 420 ktpa LAO unit on the Chocolate Bayou, TX site. This unit will provide the feedstock to support our PAO capacity additions” highlighted Walton.

“The unit will also bring benefits to the local economy, initially in the form of construction jobs and then longer term the jobs related to the continuous operation of the new unit. We would like to thank the local authorities and governing agencies who have supported the location of our unit here at Chocolate Bayou” said Bob Sokol, INEOS Oligomers Chief Financial Officer.

“The industry needs an ample supply of high quality base oils, such as PAO, to formulate the next generation of advanced lubricant products. INEOS is making the commitment to invest close to a billion dollars, in both PAO capacity and the necessary LAO feedstock supply, to ensure PAO is a viable and secure long term formulation option for our customers” said Bob Learman, INEOS Oligomers CEO. “We enjoy the full support of INEOS Group Chairman Jim Ratcliffe, who views these investment plans as a key component of the division’s growth strategy” he concluded.