Confirming plans revealed three years ago for a new linear alpha olefins (LAO) plant on the US Gulf Coast, Ineos Oligomers has announced a final investment decision. The facility will be built at Chocolate Bayou in Texas and capacity will be 420,000 t/y, which is 20% bigger than when the project was originally announced in July 2013. The company said it had decided to build a larger plant because it wanted to fully exploit the economies of scales that were available from attractive US Gulf Coast ethylene economics.

There are two ethylene crackers on the site at Chocolate Bayou, and Ineos Oligomers said there is also ready access to the US Gulf Coast ethylene pipeline distribution network  and also space available for potential future expansions.

When the plant starts up in November 2018, Ineos Oligomer’s global capacity for LAO will rise to around 1m t/y. The company’s other LAO plants are in Joffre, Alberta, Canada, and Feluy, Belgium.

Business director at Ineos Oligomers, Joe Walton, said the company continues to see strong growth of above-GDP rates for LAO in its key markets of PE comonomers, polyalphaolefin (PAO) lubricants and drilling fluids.

As well as supplying the significant new PE capacity being built on the Gulf Coast over the next several years, Walton said the plant would also provide feedstock to support its PAO capacity growth in the long term. A new high viscosity PAO unit is scheduled to go on stream in the first quarter of 2017 and engineering has begun on a new low viscosity PAO train.

Shell Chemical LP is also building a LAO plant at Geismar, Lousiana. The plant, its fourth at the site, will add 425,000 t/y of capacity when it starts production in 2018.