The Shaw Group Inc. (NYSE: SHAW) on Monday announced it has executed an agreement with Chevron Phillips Chemical Company LP (Chevron Phillips Chemical) to proceed with front-end engineering design (FEED) for a 1.5 million metric tons per year (3.3 billion pounds per year) grassroots ethylene plant.
The scope of work, which will be released in phases, follows Shaw's previous award of a contract to license its proprietary technology and provide a process design package for the project. The plant will be located at Chevron Phillips Chemical's Cedar Bayou Plant in Baytown, Texas.
"This plant will be among the first to use economical supplies of ethane feedstock derived from shale gas resources in the United States," said James Glass, president of Shaw's Energy & Chemicals Group.
Shaw has a long history of providing services to Chevron Phillips Chemical, having designed ethylene plants in the Middle East and major expansions of crackers in Port Arthur and Sweeny, Texas. In addition, Shaw has conducted studies, performed revamps and supplied furnaces at some of the company's other sites.
The undisclosed value of the contract will be included in Shaw's Energy & Chemicals segment's backlog of unfilled orders as work is authorized to proceed.