Dow Chemical to shutter 3 plants in Lousiana

03-Jul-09

Dow Chemical Co. plans to shutter three plants in Louisiana that produce ethylene and related products, along with slashing outside ethylene purchases. These steps to reduce ethylene supply have been taken as internal demand has diminished due to last year's restructuring plan. Specific sites in the company's basics portfolio that will be impacted include: *An ethylene cracker in Hahnville, Louisiana *An ethylene oxide/ethylene glycol production unit in Hahnville, Louisiana *An ethylene dichloride and vinyl chloride monomer facility in Plaquemine, Louisiana The latest round of restructuring has been approved by the company's board to result in US$100 million cost savings annually and is part of Dow’s plan of cutting annual costs by US$1.3 billion to cope with its US$16.3 billion acquisition of Rohm & Haas in April. The latest shutdowns have reduced ethylene demand in the Gulf Coast by 30% and are in addition to shutdowns announced last year of four production units in Lousiana and Texas. Dow also estimates to end purchases of about 3 bln lbs a year of ethylene from the merchant market. Dow has been seeking to shift its portfolio to higher-margin specialty chemicals and pay down billions in debt it took on when it purchased Rohm and Haas earlier this year.