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ENERGY
Fertilizer co. OCI considers nearly $5B Beaumont expansion with renewable fuels
OCI Partners LP owns an ammonia and methanol plant near Beaumont. The facility's previous owners shut it down in 2004, and OCI started the plant back up in
July 2012.
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OCI Partners LP owns an ammonia and methanol plant near Beaumont. The facility's previous owners shut it down in 2004, and OCI started the plant back up in July 2012.
OCI PARTNERS LP
By Emily Burleson
Reporter, Houston Business Journal
9 hours ago
Amsterdam-based chemicals manufacturer OCI NV is considering investing just shy of $5 billion to expand its Beaumont complex, according to documents filed with the Texas comptroller’s office.
The company is looking to add nitrogen-based fertilizer production and a renewable fuels plant to its existing ammonia and methanol plant east of Houston, OCI said.
If the plans are finalized, OCI would spend $2.8 billion on the additional fertilizer production units and $2.075 billion on the proposed lumber waste-to-fuels project, both of which would start operating in 2027, the documents said.
OCI’s proposal for the renewable fuels plant is the third such facility announced for East Texas, bringing the total proposed investments to roughly $5 billion.
The plans come to light from OCI’s applications for Chapter 313 tax incentives. Under that section of the state tax code, companies hoping to build certain industrial projects can make agreements with the local school district to lessen their tax burdens.
Employees in OCI’s Houston office are developing the projects, for which construction is expected to start in 2023 and wrap up within 2.5 years, according to the applications.
The renewable fuels plans call for a unit that turns wood waste into synthesis gas, creating renewable natural gas, OCI said. Another new unit would turn some of the synthesis gas into up to 1 million tons per year of methanol, which in turn would be processed into renewable gasoline in a third new unit.
Overall, the facility would have the capacity to make 100,000 tons of gasoline per year, according to the application.
OCI’s renewable fuels production would be less than 2 miles from a competing project being developed by Houston-based Arbor Renewable Fuels.
Beaumont is an ideal place to build a renewable fuels plant because of its proximity to the southern yellow pine forest plantations, which provide feedstock, as well as ample industrial infrastructure and access to markets, Arbor CEO Tim Vail said.
OCI said it plans to ship all of its renewable gasoline to Europe, which incentivizes the import of such fuel with lucrative credits. Meanwhile, Vail said Arbor plans to certify its fuels for sale in California as well as Europe.
OCI is also part-owner and operator of Natgasoline LLC in Beaumont, one of the largest methanol-manufacturing plants in the world, according to its developers.
For the fertilizer project, OCI said it wants to add two ammonia production units, each of which would have the capacity to make 3,000 metric tons of ammonia per day using imported hydrogen and nitrogen.
The company also wants to add a plant that uses ammonia and carbon dioxide to make 2,200 metric tons per day of urea. Some of that urea would be converted to diesel exhaust fluid, while the rest would be turned into urea ammonium nitrate, a type of fertilizer, in another new facility with the capacity to make 1,530 metric tons of UAN per day.
OCI said it would also need to build more storage tanks and connections between the new and existing units in Beaumont. The company is also considering building the fertilizer project in Wever, Iowa, instead of Beaumont, according to the application.
If the Beaumont Independent School District strikes a Chapter 313 agreement with OCI on both projects, it could save the company more than $350 million over the life of the deal, according to the application.
IN THIS ARTICLE
Manufacturing
Industry
Chemicals
Topic
Oil & gas
Topic
Renewable Energy
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