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Chinese group plans $4.5-billion methanol complex at Texas City
9:53 AM MDT | August 26, 2014 | Natasha Alperowicz
The Galveston County Economic Alliance announced on Tuesday that Fund Connell USA Energy and Chemical Investment Corp. is exploring plans to build a large methanol production and export facility at Shoal Point, Texas City. The announcement was made by the investment partners of Fund Energy, the investment division of Sino Life Insurance Co. and the Connell Group, both of China. Fund Connell USA Energy and Chemical Investment says it has initiated engineering pre-design and feasibility studies for this project with the goal of making a final investment location decision during the second quarter of 2015.
The company says it has secured the site at Shoal Point for assessment during the evaluation and due diligence period. If the final decision is made to invest at this site, Shoal Point would become the location of one of the largest methanol manufacturing plants in the world as well as a new large deep sea marine export terminal. The company will immediately begin evaluation of the site as well as the permits required to operate the proposed facilities.
The complex at full capacity could produce up to 7.2 million m.t./year of methanol for export to China in a new fleet of Post Panamax tankers. The methanol will be used by the investment partners for the production of plastics and other chemicals in plants they currently operate and plan to build in China. The total investment in the Texas City site could be up to $4.5 billion. At full development, this proposed plant could convert up to 560 million cubic feet/day of natural gas into methanol. The proposed project would also include the construction of a new deep water port facility to service a dedicated fleet of 1,000 foot long Post Panamax tankers to run a continual route from the Gulf of Mexico to China.
The proposed project would be operated by Fund Connell (USA) Energy and Chemical Investment Corp., a US corporation whose president is Madam Zhiping Song. The principal investors are Sino Life Insurance Co. (China) through their investment arm Fund Energy Investment Holdings Co., which focuses on energy and petrochemical production and the Connell Group (Jilin, China). The investors are represented by the chairman of the board of Sino Life, Zhang Jun and the president of the Connell Group Madam Zhiping Song.
“The abundant sources of natural gas in the Gulf Coast region and the expansion of the Panama Canal in 2016 make this location attractive for the production and exporting of methanol in large quantities as feedstock for the growing petrochemical production capacity in China,” says Zhang Jun, chairman of Sino Life.
The plant and export terminal could create up to 500 new permanent direct jobs and 200 new indirect and contract positions on the site. Construction could start in late 2015. “Shoal Point in Texas City is a large undeveloped site uniquely blessed with deep water access within a world class petrochemical complex to support the development of a substantial chemical or petrochemical manufacturing and export complex. The size of this site and the proximity to the open water of the Gulf of Mexico make this site especially valuable for prospects interested in utilizing the capabilities of the expanded Panama Canal in 2016,” says Bix Rathburn, Galveston County Economic Alliance president and CEO.