Formosa Plastics seeks US permits for US$2 bln expansion of Texas operations to benefit from cheaper natural gas

25-Nov-13

Formosa Plastics is seeking United States' permits for a $2 billion expansionof its Texas operations as cheaper natural gas prices make US production more competitive, as per Bloomberg. The company asked federal and state environmental regulators to approve plans for an ethane cracker unit and downstream derivatives, Formosa Plastics Vice Chairman Susan Wang said in an interview. “Because of shale gas, the cost of making petrochemical and plastic-related products is becoming very competitive here in the United States,” Wang said. “It’s probably as cost effective as in the Middle East.” The investment is bigger than was previously planned by Formosa Plastics as of February 2012, when it said it would spend US$1.7 bln to build two factories and a polyethylene plastics plant in Texas. Formosa expects to receive the environmental permits for an expansion at its Point Comfort facility, about 200 km southwest of Houston, sometime within the next year. Construction can begin immediately thereafter.