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Total goes West for greenfield Texas Gulf Coast Ethylene project

Total Petrochemicals mulls over Port Arthur new cracker

The French major company Total is looking West side of Atlantic for the expansion of its petrochemical activities with a greenfield ethylene cracker to be added on its existing Texas Port Arthur complex in USA.

As most of the international oil companies (IOCs) Total is looking to take advantage of the lowering oil and gas prices to balance its upstream and downstream activities.

BASF_Total_Petrochemical_Port_Arthur.map_Earlier this year Total had announced to put on hold its bitumen projects in Alberta and few weeks later it says to prepare major expansion on its Port Arthur refinery and petrochemical complex.

Over the last years, Total invested more than $3 billion capital expenditure in Port Arthur through different projects.

In the Port Arthur Refinery Total spent $1.5 billion to make it able to treat heavy crude oil coming from Venezuela or Canada, much cheaper than light crude.

In the Port Arthur Ethylene Cracker, Total engaged about the same amount to convert the existing naphtha-fed cracker into a mixed cracker that can accept ethane as feeder.

Total investigates sites for Gulf Coast Ethylene Cracker

When US was importing its gas, all the ethylene crackers were supplied with local oil-based refined naphtha.

But with the development of the shale gas and the evidence that local price of this abundant resources would remain low for some decades, all the companies converted their crackers to accept ethane as main feeder to save more than 30% on running costs.

The development of the shale oil in USA and the price drop by 50% it generated is reducing the advantage of the ethane compared to the naphtha, but still it is.

Total_Gulf-Coast_Port-Arthur_Ethylene_CrackerThe perspective that crude oil coming from unconventional fields could maintain the pressure on global prices is becoming consistent.

It could also contribute to sustain gas prices below $5 per million btu.

In this context, Europe ban on the fracking technologies to develop regional shale gas and shale oil is motivating IOCs such as Total to look West for world scale petrochemical projects.

In Port Arthur, Total is planning to invest $1.7 billion capital expenditure in a new ethane-based ethylene cracker for the production of polyethylene, polypropylene and all downstream derivatives.

At first estimate, Total Port Arthur Ethylene Cracker should have a capacity of 1 million tonne per year (t/y) of ethylene.

Earlier this year Total submitted its application to the Texas Commission on Environmental Quality and the US Army Corp of Engineers.

At this conceptual stage, Total is exploring alternative locations to Port Arthur around the US Gulf Coast but are unlikely to happen because of the additional costs of infrastructure it should generate for a greenfield ethylene cracker project.

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