Idemitsu, Mitsui to build U.S. petchem plant: Nikkei
Japanese oil refiner Idemitsu Kosan <5019.T> and trading house Mitsui & Co <8031.T> plan to build a petrochemical plant in the United States at a cost of up to 100 billion yen ($1.05 billion), using ethylene supplies from Dow Chemical Co , the Nikkei business daily said on Monday, without citing sources.
The complex for making surfactants and alpha-olefins with capacity of around 300,000 metric tons (330,693 tons) per year could come online as early as 2017. It would be situated next to a planned Dow plant in Texas slated for launch in 2017 that makes low-cost ethylene from cheap North American shale gas, the report said.
U.S. natural gas prices are currently $3.85 per mmBtu, well below Asian spot LNG prices of $16.15 per mmBtu. U.S. chemical industry trade groups expect prices to remain low for years due in part to ramped up production from the shale reserves.
If low prices are sustained, it would give the planned Japanese petrochemical plant a large cost advantage over European and Asian rivals, many of whom have to use crude oil-derived naphtha to make chemicals.
(Reporting by Osamu Tsukimori; Editing by John Mair)