Name of the Project
Lake Charles Chemicals Project (LCCP).
Location
Louisiana, US.
Client
Sasol.
Project Description
The project proposes the development of a world-scale 1.5-million-ton-a-year ethane cracker and derivatives complex near Lake Charles, in the southern US state of Louisiana.
Besides the ethane cracker, the project includes six downstream chemical projects. Two large polymers plants – low-density and linear low-density polyethylene, and an ethylene oxide/ethylene glycol plant – will use about two-thirds of the ethylene produced, while three smaller, higher-value derivative plants will use the balance to produce speciality alcohols, ethoxylates and other products.
The LCCP will consume about 100 000 bbl/d of ethane, sourced from suppliers that feed ethane into Mont Belvieu, Texas. While Sasol expects ethane prices to rise, it remains confident of feedstock availability, having contracted 70% of its supply and buying the balance opportunistically on the spot market.
Once commissioned, the petrochemicals complex will almost triple Sasol’s chemical production capacity in the US.
Jobs to be Created
Not stated.
Value
The cost of the LCCP has increased from $8.9-billion to a forecast $11-billion.
Duration
The project schedule has been extended. The ethane cracker portion of the project is expected to achieve beneficial operation in the second half of 2018, with 80% of the total LCCP expected to enter beneficial operation in 2018 and early 2019. The remaining volumes from the derivative units are expected to achieve beneficial operation by the second half of 2019.
Latest Developments
The skyline associated with Sasol’s ethane cracker is starting to change fundamentally as the plant’s large steel structures are installed on a portion of the vast 890 ha site.
While the LCCP is 50% complete, Sasol senior VP of North American operations Mike Thomas explains that only 15% of the project is actually built, owing to the many components that are being manufactured at factories in China, South Korea and India, and are being shipped to the US for site installation.
Key Contracts and Suppliers
Fluor Corporation and Technip joint venture (engineering, procurement and construction management contract).
On Budget and on Time?
The megaproject has encountered a number of difficulties, culminating in Sasol revising the capital budget from $8.9-billion to $11-billion – a figure initially described as a “worst-case scenario” when a project review was initiated in March 2016.
Confirmed in late August, the $2.1-billion upward revision has been attributed to a significant increase in site and civil costs (the result of poorer-than-anticipated subsurface conditions and 50% more weather-day delays when compared with the average norm), as well as an increase in contractor wage rates and labour costs.
The project schedule has also been affected, with the LCCP’s various production units to be introduced in a “staggered” manner between the second half of 2018 and the second half of 2019.
Contact Details for Project Information
Sasol director of public affairs (US) Russell Johnson, tel +1 281 588 3027 or email media@us.sasol.com.
Sasol (South Africa) head of group media relations, Alex Anderson, tel +27 11 441 3295 or email alex.anderson@sasol.com.
Fluor Corporation media relations, Brian Mershon, tel +1 469 398 7621.
Technip public relations, Christophe Bélorgeot, tel +33 1 47 78 39 92 or email press@technip.com.