Phillips and Solvay to construct U.S. HDPE Plant

Aug 31, 1999 02:00 AM

In response to increasing demand for HDPE in North America, Phillips Petroleum Company and Solvay Polymers, Inc., a wholly owned subsidiary of the Solvay Group of Brussels, Belgium, have agreed in principle, subject to execution of definitive agreements and board approvals, to build and operate a U.S. HDPE manufacturing facility that is expected to be the largest slurry loop reactor in the world. The slurry loop process is used to make preferred resins for many HDPE markets.
Phillips and Solvay Polymers each will own 50 % of the 700 mm-pounds-per-year facility and will share the plant's production of general purpose blow-moulded HDPE. Each company will independently market its share of production. Financial terms of the agreement were not disclosed.

The facility, expected to be operational in 2002, will be built on one of the companies' existing U.S. manufacturing sites. Phillips will provide the majority of the ethylene for the facility from its Sweeny, Texas, complex.
The companies alsointend to build a similar shared facility for start up in the 2005-2007 time period, as the market dictates. The second facility would be located on a site belonging to the company not hosting the initial plant.
"This is a new model for our industry," said David Birney, president of Solvay Polymers. "We needed an innovative and cost-effective way to meet the market's demand for more product. By joining forces, Solvay Polymers and Phillips will be able to accomplish this goal." Jim Gallogly, Phillips' senior vice president of chemicals and plastics, said, "This world-class plant will give us economies of scale that would not have been obtainable from a smaller facility. The co-operation with Solvay Polymers enables us both to provide our customers with low-cost, high-quality products."
Currently benefiting from an annual increase of 5 % in world demand, HDPE is a polymer with diversified and increasing applications. It is primarily used to make bottles, packaging, gas tanks and other car accessories, and pipe used in the distribution of gas and water under high pressure.

Phillips is a fully integrated petroleum company, with exploration and production, refining, marketing, chemicals and plastics interests around the globe. Founded in Bartlesville, Okla., in 1917, the company has 16,400 employees, $ 15 bn of assets and $ 12 bn of revenues on an annual basis.
Solvay Polymers, Inc., a major U.S. producer of polypropylene and high-density polyethylene resins, is a wholly owned subsidiary of Solvay America, Inc., and a member of the Solvay Group of companies, an international group of chemical and pharmaceuticals companies based in Brussels, Belgium, and employing more than 33,000 in 46 countries.
In 1998, Solvay Group companies' sales amounted to approximately $ 8.7 bn, generated by four sectors of activity: chemicals, plastics, processing and pharmaceuticals. Polyolefins represent more than 50 % of the plastics sector's sales, which amounted to $ 2.8 bn. In 1998, the Solvay Group moved to strengthen its position in the European high-density polyethylene market by concluding co-operation agreements with the TotalFina Group.

Source: Business Wire via Newspage
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