Tag Archive for: Houston Mechanical Seal Company

Irving, Texas-based Exxon Mobil Corp. (NYSE: XOM), which has a major presence in Houston, has decided to move forward with a $2 billion project in Baytown.

Exxon will expand its Baytown chemical plant, creating about 2,000 jobs during construction, according to a May 2 press release. The expansion is expected to start up in 2022.

Once online, the expansion is expected to create at least 25 permanent positions paying at least $62,970 per year, according to documents filed last summer with the Texas comptroller.

The expansion will add a new Vistamaxx performance polymer unit, which will produce “products that offer higher levels of elasticity, softness and flexibility,” per the May 2 release. It will have a capacity of 400,000 tons of Vistamaxx polymers per year, which will “contribute to a reduction in materials used and increased performance in everyday products,” per the release.

Exxon also will be able to enter the linear alpha olefins market, producing about 350,000 tons per year. “Linear alpha olefins are used in numerous applications, including high-performing engine and industrial oils, waxes and building blocks for surfactants, polyethylene plastic for packaging, and other specialty chemicals,” per the release.

According to Exxon’s release, the 100-year-old Baytown complex is the largest integrated petrochemical complex in the U.S. It spans about 3,400 acres along the Houston Ship Channel and includes a refinery, chemical plant, olefins plant, plastics plant and global technology center. Last year, Exxon completed a new 1.5 million-ton-per-year ethane cracker at its Baytown complex after four years of construction.

“Our Baytown chemical expansion will put us in a solid position to maximize the value of increased Permian Basin production and will deliver higher-demand, higher-value products produced at our Gulf Coast refining and chemical facilities,” Exxon Chairman and CEO Darren Woods said in the release. “Global demand for chemicals is expected to be greater than energy demand growth and GDP growth over the next 20 years.”

The newly announced expansion project is in addition to Exxon’s Growing the Gulf initiative, which the company announced in 2017. The $20 billion, 10-year initiative will build and expand 11 manufacturing facilities, according to previous press releases. Investments began in 2013 and are expected to continue at least through 2022.

The recently completed ethane cracker plus other projects in Mont Belvieu, Beaumont and other areas along the coast are all part of the Growing the Gulf initiative. In Beaumont, Exxon recently made a final investment decision to move forward with a major expansion of its refinery.

Another project associated with the initiative is Exxon’s joint venture with Saudi Basic Industries Corp., known as SABIC, for a proposed $10 billion, 1,400-acre petrochemical complex in San Patricio County, Texas. The plans include an ethane steam cracker that could produce 1.8 million tons of ethylene each year.

By Olivia Pulsinelli 

Courtesy of Houston Business Journal

https://www.bizjournals.com/houston/news/2019/05/02/exxon-oks-2b-baytown-chemical-expansion-project.html

The Woodlands-based Anadako Petroleum Corp.  (NYSE: APC) officially terminated its previously announced acquisition deal with Chevron (NYSE: CVX) on May 9, the same day that the California-based energy giant bowed out of a bidding war over the company.

Houston-based Occidental Petroleum Corp.  (NYSE: OXY) came out on top in that fight. The companies also announced May 9 that they have entered into a definitive merger agreement for Occidental to acquire Anadarok.

Anadarko paid a $1 billion breakup fee to cancel the Chevron deal, as expected. Glenn Vangolen, Occidental’s senior vice president of business support, will lead the integration of the two companies with a team including representatives from both, according to a May 9 press release from Occidental.

As previously announced, Anadarko shareholders will receive $59 in cash and 0.2934 of a share of OXY per share of APC. When Occidental sent that offer to Anadarko on May 5, it was valued at $76 per share. The equity purchase price of the offer was valued at $38 billion, and the deal’s total transaction value is $57 billion, including the assumption of Anadarko’s debt.

Occidental’s prior offer on April 24 also was valued at $76 per share. However, the finalized deal is for 78 percent cash and 22 percent stock, whereas the proposal announced on April 24 was a 50-50 split. When the deal for Chevron to acquire Anadarko was first announced on April 12, it was valued at $65 per share, consisting of 25 percent cash and 75 percent stock. That deal had an enterprise value of $50 billion. Based on Chevron’s stock price, the deal’s value was down to $61.62 per share as of May 3.

Additionally, Occidental’s finalized offer does not require approval by the company’s shareholders, but it does require Anadarko shareholders to approve it. Occidental has obtained committed financing for the entire cash portion of the aggregate transaction. The deal is supported by a $10 billion commitment from billionaire Warren Buffet’s Berkshire Hathaway Inc. (NYSE: BRK.A, BRK.B) and an agreement from Paris-based Total SA (NYSE: TOT) to buy $8.8 billion in assets. The Total deal represents a major portion of the $10 billion to $15 billion in divestitures that Occidental plans to make over the next 12 to 24 months. Occidental expects it could close the Anadarko deal in the second half of 2019 and that the acquisition would create $2 billion of annual cost synergies and $1.5 billion of annual capital reductions.

“We are pleased to have reached an agreement with Occidental that delivers significant, near-term value to our shareholders,” Al Walker, chairman and CEO of Anadarko, said in the company’s May 9 press release. “Anadarko’s employees have strategically assembled a premier portfolio of world-class assets, and this transaction would not have been possible without our board’s leadership over the past several months. We are proud of the substantial premium we have delivered to our shareholders and look forward to working with Occidental to ensure a smooth transition.”

Goldman Sachs & Co. LLC, Evercore, and Jefferies LLC are acting as financial advisers to Anadarko. Wachtell, Lipton, Rosen & Katz is acting as legal adviser to Anadarko. Bank of America Merrill Lynch and Citi are acting as Occidental’s financial advisers. Cravath, Swaine & Moore LLP is serving as legal counsel.

By Olivia Pulsinelli

Courtesy of Houston Business Journal

https://www.bizjournals.com/houston/news/2019/05/09/it-s-official-anadarko-cancels-chevron-deal-enters.html