ExxonMobil, SABIC to Proceed with Gulf Coast Growth Ventures Project

Source: press release, 13 June 2019

ExxonMobil Chairman and Chief Executive Officer, Darren W. Woods
ExxonMobil Chairman and Chief Executive Officer, Darren W. Woods (photo: ExxonMobil)

ExxonMobil and SABIC have announced the decision to proceed with the construction of a chemical facility and a 1.8 million metric ton ethane steam cracker in San Patricio County, Texas, leading to thousands of high-paying jobs and billions in economic output.

“Building the world’s largest steam cracker, with state-of-the-art technology, on the doorstep of rapidly growing Permian production gives this project significant scale and feedstock advantages,” says Darren W. Woods, chairman and chief executive officer of ExxonMobil. “It is one of several key projects that provide the foundation for significantly increasing the company’s earnings potential.”

The joint-venture between ExxonMobil and SABIC, called Gulf Coast Growth Ventures, received final environmental regulatory approval in June 2019 to build an ethane steam cracker, two polyethylene units and a monoethylene glycol unit. Construction will begin in the third quarter of 2019 and start-up is anticipated by 2022.

“SABIC is very pleased to move forward on this third joint venture with ExxonMobil – the first to be operated outside of Saudi Arabia,” says SABIC vice chairman and CEO Yousef Al-Benyan. “This project will not only increase global diversification for our company but will also continue to create value within our new home of San Patricio County through creating jobs and supporting economic growth. With this project, we look forward to further building our business presence in the U.S. and serving the communities and customers in the North and South American markets even more effectively.”

The project is expected to create more than 600 permanent jobs with average annual salaries of USD 90,000 per year. An additional 6,000 high-paying jobs will be created during construction. A preliminary independent study, conducted by Impact DataSource, estimates the project will generate more than USD 22 billion in economic output during construction and USD 50 billion in economic benefits during the first six years of operation.

The facility will produce materials used in the manufacturing of various consumer products including automotive coolants, packaging, agricultural film and building, construction materials and clothing.

Project construction will be led by four primary engineering, procurement and construction companies: The Wood Group, McDermott & Turner Industries Group, Chiyoda & Kiewit and Mitsubishi Heavy Industries & Zachry Group.

Gulf Coast Growth Ventures is a unique opportunity created by the abundance of low cost U.S. natural gas, and is part of ExxonMobil’s Growing the Gulf initiative, which outlined plans to build and expand manufacturing facilities along the U.S. Gulf Coast, creating more than 45,000 high-paying jobs across the region.

The project is part of SABIC’s growth strategy to build new petrochemical facilities in key markets, including the Americas, to address industry demand and achieve the company’s 2025 strategy.

Ownership interests in the Gulf Coast Growth Ventures project is 50% ExxonMobil and 50% SABIC, with ExxonMobil as site operator.