Dow Chemical said Wednesday that its board of directors has
authorized capital to finalize detailed engineering and
purchase long lead-time equipment for a new, world-scale
propylene production facility to be constructed at Dows
site in Freeport, Texas.
This represents the latest move in a strategy to increase
ethylene and propylene production and connect operations with
low-cost feedstock opportunities available from increasing
supplies of US shale gas, the company said.
This authorization marks yet another significant
milestone in Dows comprehensive plan to create
competitive advantage for our downstream Performance Materials
and Advanced Materials businesses by further connecting our US
operations with cost-advantaged feedstocks, said Jim
Fitterling, executive vice president of Dow and president of Feedstocks & Energy and
This investment directly supports Dows
transformational strategy to enhance its feedstock flexibility and integration strength, and positions
the company for growth in attractive markets and
geographies, he added.
Basic engineering work for the new on-purpose propylene
production facility at Dow Texas Operations has commenced, and
the project is on track for production
start-up in 2015.
In December 2011, Dow and UOP, a Honeywell company, signed a
technology licensing agreement,
enabling on-purpose propylene production at the facility.
Under the terms of this agreement, Dow will license UOP's
proprietary C3 Oleflex process technology for manufacturing
on-purpose propylene from propane.
Dow also signed catalyst supply and performance guarantee
agreements with UOP.
On-purpose propylene production from propane will create
better economic value for Dow compared with high-priced
purchased propylene, the company said.
The availability of cost-advantaged feedstocks from US shale gas
developments represents a value-creating opportunity for our
downstream businesses, and Dow is capitalizing on this,
said Brian Ames, vice president of Olefins, Aromatics and
Our company was among the first in our industry to
declare a comprehensive plan to take advantage of the
increasing supplies of US natural
gas liquids, and we remain on track to implement that plan,
which will create thousands of domestic jobs.
The project is expected to create 1,300
jobs at its construction peak.
Cover photo courtesy of Greenpeace