LyondellBasell announced plans March 3 to build a 400,000 metric ton propylene production unit at its Channelview Complex near Houston. The $125 million metathesis plant, scheduled to begin construction in Q3 2025 and start operations in late 2028, will convert ethylene into propylene – a key feedstock for polypropylene and propylene oxide manufacturing.
Expansion Follows Workforce Reductions
The capacity expansion comes days after reports of impending layoffs tied to the closure of LyondellBasell’s oldest Houston refinery. While the new unit will create 25 permanent positions and employ 750 workers during peak construction, these gains follow significant workforce reductions elsewhere in the company’s operations.
Strengthening Core Business Lines
The metathesis technology will enhance LyondellBasell’s propylene self-sufficiency while supplying materials for critical applications including medical devices, automotive parts, and food packaging. “This investment addresses growing customer demand while reducing our exposure to market volatility,” said Kim Foley, EVP of Global Olefins and Polyolefins.
Strategic Response to Market Demands
By converting surplus ethylene into higher-demand propylene, LyondellBasell aims to optimize its product portfolio. The expansion reflects the company’s focus on core petrochemical operations even as it restructures other assets, positioning itself for long-term competitiveness in essential materials markets.
Balancing Growth and Restructuring
The simultaneous expansion and workforce reductions illustrate LyondellBasell’s strategic pivot toward higher-value production. While improving operational efficiency and shareholder returns, these moves represent a significant transformation of the company’s Houston-area manufacturing footprint.
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