BP to sell Decatur, Alabama petrochemical facility

OREANDA-NEWS. November 19, 2015. BP will sell its Decatur, Alabama petrochemical facility in effort reorganize the company's petrochemicals business, the company announced today.

The 1,000-acre Decatur facility produces up to 1mn t/yr of purified terephthalic acid (PTA), in addition to paraxylene (PX) – a feedstock for PTA production. The site also produces naphthalene dicorbxylate (NDC), which is used in polyesters or resins for flat LCD panels and thin storage tape. Three of the five production sites at the Decatur facility produce PTA, one produces PX and the other markets NDC.

The planned sale comes after more than a year of poor margins for domestic PX production, which led the US to import PX feedstock for PTA units as prices for mixed xylenes were too high to produce it domestically.

"Our strategy is to significantly improve the cash breakeven performance of the business, enhancing earnings potential and making it more resilient to bottom-of-cycle conditions," said Tufan Erginbilgic, chief executive of BP's global downstream business. "We look to have a portfolio with BP's world-leading technology resulting in highly efficient production of PTA in key markets around the world."

BP is already spending \\$200mn to upgrade its Cooper River, South Carolina and Geel, Belgium PTA plants to lower operating costs, increase reliability and shrink emissions. BP also has a PX and metaxylene production facility in Texas City, Texas.

Recently, BP started up its new Zhuhai 3 unit in Guangdong Province, Chin, which can produce up to 1.25mn t/yr of PTA. In total, BP produces up to 6.5mn t/yr of PTA globally from six locations.