Shell Chemical has made a final investment decision (FID) to increase its alpha olefins (AO) production at its chemical manufacturing site in Geismar, Louisiana, the company announced on Monday.

The expansion will make the Geismar site the largest AO producer in the world. 

Shell will construct a fourth AO unit, adding 425,000 tons of annual capacity. The chemical site is used in the production of stronger and lighter polyethylene plastic for packaging and bottles, as well as engine and industrial oils and drilling fluids.

“This important investment demonstrates our ongoing commitment to the growth potential in chemicals,” said Graham van’t Hoff, executive vice president for Royal Dutch Shell’s global chemicals business. “With the investment in new, profitable facilities, Shell Chemicals is well placed to respond to increased global customer demand for linear alpha olefins. We have strong technology, advantaged ethylene feedstock from nearby Norco and Deer Park sites, and operational flexibility to allow us to respond to market conditions.”

Construction of the new unit will begin in the first quarter of 2016. The new capacity brings the total AO production at Shell’s Geismar site to more than 1.3 MMtpy.

The Geismar site, with a strong track record of reliable and safe performance, also produces alcohols, ethoxylates, ethylene oxide and ethylene glycols. 

The Shell Geismar complex is located next to the Mississippi River, about 20 miles south of Baton Rouge, Louisiana. It is a stand-alone chemicals manufacturing plant, operated by Shell Chemical. In addition to Geismar, Shell produces AO at Stanlow in the UK, operated by Essar Oil on Shell’s behalf as part of an integrated oil refinery and petrochemicals site.