Engineering News

S.Africa's Sasol Gives Go-ahead to $8.1 Bln U.S. Ethane Cracker
October 27, 2014

JOHANNESBURG, Oct 27 (Reuters) - Sasol will build an $8.1 billion plant in the U.S. state of Louisiana to convert natural gas into plastics ingredient ethylene, it said on Monday, as part of the biggest overseas investment by a South African company.

The final investment decision to build the ethane cracker at Sasol's existing Lake Charles, Louisiana, site is expected to be followed by plans to build an integrated gas-to-liquids and chemicals facility there, too.

That project, with a current cost estimate of $11 billion to $14 billion, is expected to receive a final investment decision in 18 to 24 months.

The planned cracker will produce 1.5 million tonnes of ethylene a year for use in plastics and chemicals.

"Approximately 90 percent of the cracker's ethylene output will be converted into a diverse slate of commodity and high-margin speciality chemicals for markets in which Sasol has a strong position," the company said.

The price announced on Monday was higher than previous estimates of between $5 billion and $7 billion. Sasol spokesman Alex Anderson said it had been raised as the company "refines" its final cost tally.

Sasol will also invest an additional $800 million in infrastructure and utility improvements, as well as on land acquisition.

Fluor Technip Integrated, a joint venture between Fluor Corporation and Technip, will be the project's primary "engineering, procurement, and construction management contractor", Sasol said.

Source: Reuters

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