Chevron Phillips, QatarEnergy Reach Agreement on $8.5 Billion Polymers Plant in Texas

Chevron Phillips Chemical and QatarEnergy announce plans to build $8.5 billion polymers facility in Orange, Texas. Chevron Phillips Chemical Photo

Chevron Phillips Chemical and QatarEnergy announced on Wednesday a final decision to invest $8.5 billion to build the world’s largest polymers facility in Orange, Texas, near the Gulf Coast.

“We are excited to announce taking the FID [final investment decision] on our largest petrochemical investment ever, highlighting QatarEnergy’s integrated position as a major player in the LNG [liquefied natural gas] and international exploration sectors, as well as being a global petrochemicals producer,” Saad Sherida Al-Kaab, energy minister, president and CEO of QatarEnergy, said in a news release.

The pair, which have collaborated for more than two decades on projects in Qatar, created a joint venture, Golden Triangle Polymers Plant, LLC, for the Texas project. Chevron Phillips Chemical holds a 51 percent equity stake and QatarEnergy owns 49 percent.

“Chevron Phillips Chemical and QatarEnergy have collaborated for over 20 years on the assets we operate together in Qatar. We have a great relationship and a proven track record of operating these facilities safely and reliably,” Bruce Chinn, president and CEO of CPChem, said in a statement.

Chevron Phillips Chemical is equally owned by Chevron U.S.A. Inc. and Phillips 66 Co.

Meeting Global Demands

The project is a move for the two companies to meet the growing demands for polymers across the globe.

“In addition to complementing QatarEnergy’s growing international portfolio, as well as in the United States, this important project will help meet growing global demand for polymers,” Al-Kaab said.

“It also represents a major step in the implementation of our downstream strategy and the next phase of QatarEnergy’s growth, which includes major investments in ethylene, ethylene derivatives and polymers in general.”

Polyethelene Production

The plant, which is expected to be in operation by 2026, will produce polyethylene, the most commonly used plastic in the world.

“Our products make life better for billions of people every day, and they are part of a lower-carbon future. This facility will help meet the growing demand for our products and improve the quality of life for the world’s growing global population,” Chinn added.

Polyethelene is used to produce many widely used items, including food packaging, coolers, housewares, water pipes, and more.

Project to Add Hundreds of Full-Time Jobs

The facility is expected to create more than 500 full-time jobs and approximately 4,500 construction jobs, according to Qatar.

“This facility will contribute to the social and economic fabric of the entire Golden Triangle region of Texas, bringing in thousands of high-paying American jobs and billions of dollars in economic impact. We care deeply about the community of Orange, and we’re thrilled to be bringing jobs and resources to the region with safety and environmental performance at the forefront, as always,” Chinn said.

Construction of the Golden Triangle Polymers Plant is slated to begin immediately.