Shell Chemical to expand alpha olefins production plant in Louisiana

Houston-based Shell Chemical LP announces it will expand its petrochemical alpha olefins production at its chemical manufacturing site in Geismar, Louisiana. This expansion will make the site the largest alpha olefins producer in the world.

The alpha olefins produced by the company's plant in Louisiana are used to produce a variety of consumer and industrial products including plastics, household detergents, synthetic lubricants, industrial oils and drilling fluids.

The new expansion will include a $17 million capital investment, stated Louisiana Government Bobby Jindal, according to The News Star. It will also create 20 new jobs with an average annual salary of $104,000 plus benefits. The company will retain 650 of existing jobs at Shell's site in Geismar.

To build the plant's construction, the company estimates will employ 1,000 of construction workers at its peak building activity.

According to Fuelfix, Shell's expansion will add 425,000 tonnes of annual capacity or about 468,000 U.S. tons. The expansion will create the plant's  total capacity of 1.3 million tonnes or about 1.4 million U.S. tons.

Royal Dutch Shell's Executive Vice President for global chemicals business Graham van't Hoff said in a statement that the important investment in Geismar demonstrates the company's commitment to the growth potential in chemicals.

"The investment will place Shell Chemicals in new profitable facilities to respond to increased global customer demand for linear alpha olefins", he added.

Construction on Shell's Geismar expansion will begin in the first quarter of 2016, according to PR Newswire.

The chemical plant is located along the Mississipi river, about 20 miles south of Baton Rouge, Louisiana. Other companies neighboring Shell's Geismar plant including BASF and Occidental Chemical Corp.

The Shell Geismar Chemical Plant is a stand-alone chemicals manufacturing plant operated by Shell Chemical LP. The site also produces alcohols, ethoxylates, ethylene oxide, and ethylene glycols.

Shell also has another oil refinery and petrochemical site that produces alpha olefins chemicals at Stanlow in the U.K., operated by Essar Oil Ltd. on Shell's behalf.

Royal Dutch Shell Plc.'s final decision to increase production at the company's petrochemicals plant in Louisiana aims to take an advantage of cheap and abundant oil and natural gas in the U.S. that serves as feedstock for the petrochemical plants.

The petrochemical projects in the U.S. counted to 256  with a cumulative investment of $158 billion from 2010 to 2013. About 60 percent of the projects are still in the planning stages. Nearly 65 percent of the investment in the U.S. petrochemicals industries comes from foreign investors.