As part of an official signing ceremony at the White House, Chevron Phillips and Qatar Petroleum announced this week that they have finalized an agreement under which the two will build an $8 billion petrochemical plant in the United States.
Dubbed "U.S. Gulf Coast II Petrochemical Project (USGC II)," the project will include an ethylene cracker slated to be the biggest in the world with a capacity of 2 million tons per year. The complex will also feature two high-density polyethylene units, each with a capacity of 1 million tons per year. Chevron Phillips will have a controlling interest in the new production facility and will oversee construction and operations when the plant is complete.
The companies have yet to disclose the exact location but said that they will construct the new plant somewhere in the U.S. Gulf Coast region where they can readily access the ethane from U.S. shale sources. They plan to select engineering, procurement and construction (EPC) contractors in 2021 and open the new facility in 2024.
Like similar projects that have either been completed or are currently underway, construction of the new plant, according to the Houston Chronicle, is expected to create thousands of construction jobs. Chevron Phillips opened a petrochemical plant in Baytown, Texas, last year and has hinted at a potential future expansion in Orange, Texas, about 90 miles away. The new project with Qatar could generate as many as 9,000 construction jobs.
Taiwan-based Formosa Petrochemical Corp. announced earlier this year that it would build a $9.4 billion petrochemical plant on a 2,400-acre site in St. James Parish, Louisiana, between New Orleans and Baton Rouge. It was supposed to break ground sometime this year, promising about 8,000 construction jobs at peak activity, but the project's permit could be held up over concerns about the health of local residents.
The state of Louisiana held a public hearing last week about the air permits that Formosa has proposed, which, according to The Advocate, would double toxic air emissions in the parish from 1.6 million pounds to 3.2 million pounds per year. The Louisiana Department of Environmental Quality is accepting comments on the Formosa project until Aug. 12.
Environmental activist opposition is always a concern when it comes to breaking ground on these megaprojects and delivering on the promised jobs, but that's not the only factor that could interfere with the construction employment opportunities. Recently, executives at ExxonMobil-SABIC revealed that they were cutting in half the number of jobs they predicted would be generated during the construction of its $10 billion ethane steam cracker and plastics plant in Corpus Christi, Texas. The reason behind this shift is that the project will now use some modular and offsite construction techniques.