After meeting in Houston April 10 to review updated project economics and financing needs, the Appalachian Resins, Inc. (AR) development team has agreed to continue moving forward with plans to build an ethylene/polyethylene production facility in Monroe County, Ohio, DownstreamToday has learned.
"The world market price of polyethylene tracks the price of crude oil," Jim Cutler, AR's chief executive officer, told DownstreamToday. "This is because most of the world’s ethylene is produced from naphtha, which is obtained from crude oil. Lower crude prices mean lower naphtha prices, which in turn triggers lower polyethylene prices. The lower crude price scenario reduces the relative advantage of using ethane as an ethylene feedstock. In addition to lower polyethylene margins, we have seen an escalation to capital costs."
As this August 2014 article indicates, AR had estimated an approximately $1 billion price tag for the project.
"Total project costs are now viewed to be about $1.3 billion," said Cutler. "Even with changing conditions, Appalachian Resins still appears to be a viable project. This is because of the plant's location and configuration."Read more by clicking here.
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