Texas chemical company eyes another in-state methanol unit

Celanese Corp. is considering expanding its South Texas chemical plant to produce methanol, the company has announced.

Building a methanol unit at the plant in Bishop near Corpus Christi would be the latest move by the Dallas-based chemical company to capitalize on an abundance of cheap U.S. shale gas. Celanese has been building a new methanol unit in Clear Lake, southeast of Houston under a joint venture with Mitsui & Co., one of Japan’s largest generally traded companies.

The project, which should be finished by October, will have the capacity to produce 1.3 million tons of methanol per year. Made from natural gas, methanol is used in a wide range of products, including plastics, paints, solvents, refrigerants and pigments.

Related: Celanese plans Texas methanol plant to tap cheap gas

Once finished, Mitsui and Celanese will each take some of the methanol produced at the unit under a five-year agreement, the company said. Celanese uses methanol to make acetyls, the raw ingredients for the production of plastics, paints and coatings.

The company has already filed for air permits from the Texas Commission on Environmental Quality to build a methanol unit in Bishop, a necessary beginning step before construction, but final investment will hinge on market conditions and construction costs, the company said. Celanese, which split the $800 million price tag of the Clear Lake project with Mitsui, plans to partner with the company to explore building a similarly sized unit in Bishop.

According to projections, the world will add 50 million metric tons of new methanol capacity within the next decade, with about one-third of that coming from North America, energy analyst firm IHS said in a report last year.