Petrochemical producers on the U.S. Gulf Coast are facing hundreds of millions of dollars of investment costs to comply with EPA regulations and the State Implementation Plan (SIP) proposed by the Texas Natural Resource Conservation Commission (TNRCC; Austin) to sharply reduce emissions of nitrogen oxide (NOx) and volatile organic compounds (VOC) . Compliance with the reduction targets, which call for a 90% reduction in NOx and VOCs, could cost the petrochemical industry alone as much as $1.5 billion, says P.J. Juvekar, analyst at Salomon Smith Barney (New York). “This could lead to permanent shutdowns of some older high-cost ethylene facilities,” Juvekar says.
Dow Chemical has announced that it will permanently shut down its crackers at Texas City, TX and Seadrift, TX with capacities totaling 2.6 billion lbs/year.
Chevron Phillips Chemical has closed a 400-million lbs/year ethylene cracker at Sweeny, TX, one of the crackers identified by analysts as a candidate for closure because of its high cost.
ExxonMobil’s 750-million lbs/year unit at Houston could also be threatened by the cost needed to comply with the 90% targeted NOx emissions because of its high costs, Juvekar says.
Dow says it is evaluating cogen facilities in Texas that will help it meet the NOx standards, and is already using new cogen facilities that have low NOx emissions in Louisiana.
Shell is developing low NOx burners at Deer Park, TX and is moving ahead with some engineering work for installing SCR systems at Deer Park, says Steve Rathweg, global manager/manufacturing center for excellence at Shell.
BASF plans to install SCR systems were required at its cogen facilities, incinerators, and reformers, says Carl Jennings, executive v.p., and president/chemicals at BASF Corp.
BP says it is able to meet the 90% reduction target. The company recently awarded a contract to Jacobs Engineering to build a 570 megawatt/hour cogen facility at Texas City, TX that it says will reduce NOx emissions by 53%.