Air Liquide plans to invest around $170 million in a plant to supply oxygen for Chinese petrochemical giant Yuhuang Chemical's planned methanol manufacturing complex in St. James Parish, Louisiana.

The methanol facility, set to start up in the second half of 2017, is expected to be one of the largest of its kind in the US, with a capacity of 5,500 t/d.

Air Liquide said it has signed a long-term agreement to supply Yuhuang Chemical with 2,400 t/d of oxygen. The French gases producer's air separation unit for production of oxygen, nitrogen and argon will be connected to Air Liquide's Louisiana pipeline system, as well as Yuhuang Chemical's St. James site.

The gases company also recently signed a contract to license its proprietary MegaMethanol process technology to Yuhuang Chemical.

Construction of the Yuhuang complex is slated for begin in 2016, with the first $750 million phase of the methanol project planned to start up in 2018.

When this phase is completed, the Chinese firm plans to build a second $500 million methanol plant, lifting its annual methanol capacity to 3.3 million t/y. A third phase will include a methanol derivatives plant for chemical intermediates.

The methanol complex will be the first foreign investment for Yuhuang Chemical, a subsidiary of China's Shandong Yuhuang Chemical Co.