Sasol’s new US complex in Louisiana now half complete

The massive Lake Charles Chemicals Project includes a 1.5m tonne/year ethane cracker and six downstream chemical production facilities. The total project is expected to achieve beneficial operation in H2 2019. (Image source: Sasol)

Focus article by Tracy Dang

HOUSTON (ICIS)–Sasol’s new world-scale Lake Charles Chemicals Project (LCCP) in Louisiana is about half complete, with construction around 15% complete, according to company executives from the South Africa-based producer.

The LCCP in Westlake, Louisiana, consists of a 1.5m tonne/year ethane cracker, as well as six downstream chemical production facilities.

The first unit, a linear low density polyethylene (LLDPE) unit, is expected to achieve beneficial operation in H2 2018, company executives said on Thursday during a media tour of the site.

This will be followed by the ethane cracker and the ethylene oxide (EO) and mono ethylene glycol (MEG) units later that year, and then a low density polyethylene (LDPE) unit shortly thereafter.

The total project is expected to achieve beneficial operation in H2 2019, company executives said.

The LCCP will consume about 100,000 bbl/day of ethane. The cracker is a purity ethane cracker – meaning its feedslate will consist of 90-95% of ethane – rather than a flexible cracker.

“I can’t tell you how many times we’ve asked ourselves this question,” said Mike Thomas, senior vice president of US operations at Sasol. “The truth of the matter is we want ethylene. The flexible crackers that you see out there, generally speaking, they have demand for the other products they make – propylene or whatever they may be. If you look at our value chain, it’s an ethylene value chain, therefore, we’re interested in the ethylene.”

He added: “If you look at the cycle, I think you will also notice that ethane crackers over the cycle, tend to be lower cost, and they tend to be more profitable. The crackers that are flexible tend to be integrated with feedstocks.”

Approximately 90% of the cracker’s ethylene output will be converted into Sasol’s portfolio of base chemicals and specialty chemicals.

The polyethylene (PE) units will have a capacity of 900,000 tonnes/year.

The ethylene oxide (EO) chain consists of a 300,000 tonne/year crude EO unit with hydrolysis and purification capacity and a 100,000 tonne/year ethoxylation unit that will supplement capacity on the site.

The 173,000 tonne/year Ziegler alcohol unit will supplement existing capacity on site, as well as add to the company’s global production of alcohols. Alumina production of 30,000 tonnes/year will supplement existing capacity on site and in Europe. The 30,000 tonne/year Guerbet alcohol unit will add to the company’s global production capacity.

The remaining ethylene will supply Sasol’s 50% share of its joint venture with INEOS in Texas, which will produce high density polyethylene (HDPE). The remaining amount is being sold to the merchant market.

With a number of new cracker and derivative facilities coming online in the coming years, Sasol does believe there will be some oversupply of PE, although not for long.

“We do see a glut of PE coming to the market,” said Fleetwood Grobler, executive vice president of chemicals business at Sasol. “There will be a generous supply of PE.”

However, demand is growing with gross domestic product.

“In a number of years, we’ll balance that out,” Grobler said. “We don’t see a prolonged glut of PE supply.”

Sasol executives did say that the company has had little problems obtaining skilled labourers to work on the project, which is a concern in the megacomplex construction industry.

Sasol is the last cracker scheduled to come online out of the several companies that have made financial investment decisions (FID) to build one.

“As these projects finish, we’re on the back end of that,” said Steve Cornell, one of the company’s joint presidents and CEO. “We have Dow coming online next year, then Exxon and Chevron Phillips. We’re in a good position.”

Sasol executives said the company is also in a good position when it comes to labourers to operate the complex when the project is complete.

The Louisiana state government has invested $20m for a new training facility at Sowela Technical Community College in Lake Charles to help support the project’s workforce needs.

“We’re ahead of the game on that one,” Thomas said.

The following table from ICIS shows the new crackers announced by companies.

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Olefin storage spheres under construction at the world-scale Lake Charles Chemicals Project in Louisiana. (Image source: Sasol)