The Dow Chemical Co. (NYSE: DOW) began production at its massive propylene production facility at the company’s Oyster Creek site in Freeport, Texas, on Dec. 18.
The plant is part of the company’s $4 billion initiative to expand its operations in the Texas Gulf Coast.
“This milestone solidifies our first-mover advantage by bringing our investments in the U.S. Gulf Coast to fruition,” Andrew Liveris, Dow’s chairman and CEO, said in a statement. “This is another important step in executing Dow’s global growth strategy, further increasing our feedstock flexibility by harnessing the value of integration and positioning the company for growth in attractive, fast-growing markets.”
Propylene is a main component of plastics. Dow’s new site is slated to create about 750 kilotons of propylene annually, making it one of the largest facilities of its kind.
In addition to the propylene plant, Dow is also underway on a world-scale ethylene production facility in Freeport. The company said it is making significant progress on the project but did not disclose an expected completion date.
Together, the Gulf Coast projects will connect low-cost raw materials — namely natural gas — to many of Dow’s highest-margin downstream businesses.
Michigan-based Dow Chemical is the second-largest manufacturing firm in Houston based on its number of local full-time employees.
The company announced earlier this month that it would merge with Delaware-based DuPont (NYSE: DD) to create a chemical giant with a combined market capitalization of approximately $130 billion.