Sasol’s Lake Charles chemical complex to cost US$2 bln more than estimated

09-Jun-16

Sasol's planned Lake Charles chemical complex could cost up to US$11 bln, US$2 bln more than originally estimated. Delays caused by heavy rains affecting construction timetables, higher labour costs, and elevated bid contracts are part of the reason for the cost escalation.
The complex will consist of an ethane cracker producing 1.6 mln tpa of ethylene, two polymer plants, an ethylene oxide-ethylene glycol plant, and three smaller derivative plants.

Kim Cusimano, Sasol spokeswoman, said that because of the weather, the project has incurred 46 additional rain days above the 10-year average of 134. The delays have increased costs while also extending the construction schedule, she said. “Keep in mind that our site is probably three to four times the size of other ‘similar’ projects as we must also develop all of the needed utilities, off-sites and infrastructure as compared to an existing site, and some aspects were particularly challenging,” Cusimano said. Prior to the project’s final investment and groundbreaking, Sasol’s front-end engineering and design phase efforts focused mostly on the technical aspects of the project, especially the ethane cracker. Cusimano said this was done “to ensure minimum design changes during the execution of the project.”
The ethane cracker and the major derivative units are still scheduled to achieve beneficial operation in the H2-2018. The seven manufacturing units at the Lake Charles complex are spread across roughly 400 acres in Westlake. The mutlibillion-dollar project will triple Sasol’s chemical production capacity in the U.S., according to company officials.