Ineos announces new world-scale alpha-olefins unit in the United States

Today INEOS Oligomers unveiled future growth plans for its Linear Alpha Olefin (LAO) and Polyalphaolefin (PAO) product lines.

“It is our intention to build a new world scale LAO unit on the Gulf Coast of the United States” declared Bob Learman, INEOS Oligomers CEO. “The unit will have an initial capacity of 350 thousand metric tons, and like our existing units it can be built with a further 50% expansion in mind. So ultimately the capacity could reach over 500 thousand metric tons. INEOS Group already has a significant footprint on the Gulf so we have ready access to key resources. We have been working on this project for the past year and it is now ready to scale up for a new phase of activity. The project is targeted for completion by the end of 2016”. “We believe our market and technology focus on Polyethylene comonomers and PAO, combined with our access to advantaged ethylene economics, makes for a very attractive opportunity” added Joe Walton, INEOS Oligomers Business Director.

INEOS is also evaluating incremental expansion opportunities at its Canadian site. “Our LAO unit in Joffre, Alberta was initially designed to be expandable by 50%” stated Karel Brabant, INEOS Oligomers Operations Director. Therefore, we have a number of opportunities to access additional capacity in capital efficient ways. The first step of this program is well underway with a project that will expand the unit’s capacity by 10%”. This project will be completed by the end of first quarter 2014” he added.

“The expansion of our LAO capacity will also provide significant additional feedstock supply to support the anticipated growth of our PAO business” stated Learman. “The global demand for lubricants has been impacted by the current difficult conditions in both the European and Asian automotive sectors” outlined Walton. “Despite this backdrop, our PAO business has been quite resilient. It will continue to benefit from lubricant reformulation activity to attain better fuel economy and to lower carbon emissions. INEOS Oligomers is the world’s largest merchant supplier of PAO and our investment plans will ensure we maintain this position” he added. “We built a new PAO train at our Feluy, Belgium facility back in 2009.” stated Brabant. “More recently, we have just completed a 10% debottleneck of our facility in LaPorte, TX. Furthermore, we have a project engineered for a 15% debottleneck at Feluy.

These incremental capacity additions will allow us to support PAO growth until we add an additional new train, the size and timing of which will be aligned with the development of the market” he added.

“We are extremely excited about our opportunities to grow these two key businesses” summarized Learman. “The bulk of this investment will be in North America and thus represents a component of the INEOS Group vision outlined recently by our Chairman Jim Ratcliffe. The scale of these new capacity additions underlines our commitment to the industry and will allow us to meet the needs of our customers for the foreseeable future” he concluded.