Orbia aims to complete US PVC plant by 2028

Spanish Market: Chemicals, Petrochemicals
06/06/23

Global polyvinyl chloride (PVC) producer Orbia aims to bring a chlor-alkali and vinyls plant online in the US Gulf coast region by 2028.

The site would produce roughly 1mn tonnes per year (t/yr) of suspension grade PVC, with additional resources aimed at expanding specialty resin output by 110,000 t/yr as well as support for compounded resins used in Orbia's wire and cable business. It would also be integrated to include chlor-alkali with potential output at the site around 640,000 dry t/yr of caustic soda according to expectations relayed in an investors' meeting from the previous year.

The new production site was alluded to in an investors' meeting in May 2022. A year later, Orbia has further specified it would begin investment and construction in 2024 and complete construction by 2028. The original timeline was from 2022 to 2026, and Orbia said it could adjust the timeline further if needed.

A final location was still not provided, but the company indicated it was looking to access feedstock resources in the US Gulf region, potentially placing the facility somewhere in the Texas/Louisiana coastal region. Orbia already has a 550,000t/yr ethylene cracker in Ingleside, Texas as part of a joint venture with OxyChem. Ethylene incorporation into Orbia's new US site was not specifically discussed in the investors' meeting.

The company said the US expansion site would be fully owned by Orbia, allowing its supply and revenues to be better internalized and secured from exterior disruptions.

Despite the recent global slowdown in PVC consumption, the company expressed confidence in its plans for expansion as it views the global PVC industry as undersupplied and production investments as underdeveloped. It expects global needs to grow over the next decade, not only for PVC building products, but for water management, medical devices, and irrigation materials.

Orbia is still in the process of conducting engineering tests and field studies both in North America, as well as other regions such as China, to better understand global supply levels and trade dynamics to make sure its investments are properly allocated. Following the field studies, the company will seek final approval from its board of directors and begin issuing preliminary investments for the expansion project.

The company said it hopes its expansion will not only meet expected demand growth, but also shore up its existing supply needs within its subsidiaries, as the company has a footprint in various regions and products. Orbia has a European arm, Vestolit, in addition to subsidiaries in the US, Europe, India, and Latin America under subsidiaries Alphagary and Wavin.

By Aaron May

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