After approving $675M Texas investment, Braskem says don't count out Marcus Hook

Braskem, the Brazilian thermoplastics producer whose North American operations are based in Philadelphia, announced Thursday that it had formally approved spending $675 million to build a new polypropylene plant in Texas after ruling out a site last year in Marcus Hook because of the lack of infrastructure.

The new facility in La Porte, Texas, will produce nearly 500,000 tons of polypropylene a year. It will be situated on a 200-acre site next to Braskem’s current production facilities, which can produce about 390,000 tons of the plastic, used to make such things as yogurt containers.

Braskem had considered building the new plant in Marcus Hook, where the company operates another polypropylene unit. But the site near Houston had a critical advantage over Marcus Hook: a ready supply of raw material from nearby petrochemical operations.

Mark G. Nikolich, chief executive of Braskem America, said Thursday that the decision to build in Texas does not diminish the company’s desire to expand operations near Philadelphia.

“Because we’re making an investment in Texas should in no way signal that we won’t make an investment here in the future,” Nikolich said.

Last year, local business leaders held up Braskem’s decision to expand in Texas as an example of why Pennsylvania business and political leaders needed to support the build-out of pipeline infrastructure to deliver raw material from the Marcellus and Utica Shale formations. Those pipeline projects, including Sunoco Pipeline’s Mariner East project, have attracted fierce opposition from activists opposed to fossil-fuel development.

Braskem, which acquired the Texas and Marcus Hook plants when it bought Sunoco Chemical in 2010, has “never been more committed” to Philadelphia, Nikolich said.

The company has invested $50 million in two years at its Marcus Hook plant, he said, increasing capacity 20 percent. It has expanded its rail facilities to improve its ability to move raw materials into the plant and to ship out plastic pellets.

And last year it renewed its headquarters lease at the Mellon Bank Center, 1735 Market St.

“We love the city,” Nikolich said. “We just recently expanded our footprint in Center City by over 75 percent. In doing that, we created space for growth aspirations for North America based out of the headquarters.” The engineering teams that designed the new Texas plant worked out of Philadelphia, he added.

The Texas polypropylene plant could be a prototype for a future expansion in Marcus Hook, if sufficient pipeline infrastructure is built to keep the facility supplied, Nikolich said. “We can use this project in Texas as a blueprint for one we’d do in Marcus Hook.”