ExxonMobil Will Build World's Largest Steam Cracker Plant in San Patricio County

Gregory Mayor Celestino Zambrano points out the site of the proposed petrochemical plant, nestled between Gregory and Portland.
Gregory Mayor Celestino Zambrano points out the site of the proposed petrochemical plant, nestled between Gregory and Portland. Photo by Marco Torres
After months of deliberation, ExxonMobil and Saudi Arabia Basic Industries Corporation have finally made it official: The companies are building a new petrochemical plant, with the world's largest ethane steam cracker at its heart, in San Patricio County.

It makes all the sense for Exxon and Sabic to choose this site, as Rob Tully, Exxon's project manager for the joint venture, pointed out in a release issued announcing their decision on Wednesday. “The location in San Patricio County has all of the elements we wanted to see in a location to build our project. The large area of land with a single owner, its ready access to rail and deep water port facilities, the existing infrastructure, its proximity to raw materials, a positive business climate and already workforce for construction and operations made this our preferred site," Tully stated. “We look forward to continuing our work with the Coastal Bend community as we progress our plans and pursue permits to build at this location.”

Spurred by the glut of cheap natural gas on the market due to the gas-rich U.S. shale plays, Exxon and Sabic, longtime partners in Saudi Arabia, were considering four sites along the Gulf Coast for more than a year. Company officials shortlisted four locations, including one in Victoria and two in Louisiana parishes, for the $10 billion plant, but it was clear that they preferred the 1,400-acre tract of raw farmland wedged between the city limits of Portland and Gregory.

However, not everyone in the area was as thrilled about the idea of Exxon and Sabic's location choice in San Patricio County, which will put the plant just a mile from Gregory-Portland High School.

While some communities were ecstatic at the idea of Exxon and Sabic coming to town, the prospect created a sharp division in Gregory and Portland, as we reported in our recent cover story, "Game Changer", mainly because of the location. The project was hailed as a chance to create jobs and give an economic boost to the impoverished South Texas county by some, particularly Gregory residents. At the same time that others, mostly in Portland, were alarmed by the proposed project's proximity to the high school and other schools in the area. They insisted the plant would bring more noise and health issues than good to the county.

The tension erupted into protests and fights at local government meetings, starting in December when the San Patricio County Commissioners and the Gregory-Portland Independent School District board began considering tax break requests from Gulf Coast Ventures, the company Exxon and Sabic have formed for the project. Opponents of the project pushed officials to deny these requests, but Tully steadily maintained that the question of whether or not Exxon and Sabic would choose the site hinged on getting these tax breaks.

Both entities ultimately approved the tax breaks last month, as we reported, which seems to have led directly to Exxon (they're the ones really running this show) making things official about the San Patricio site.

Workers are slated to break ground on the Exxon plant by 2020 and it could be online by 2021, according to documents filed by Exxon with the Texas Comptroller. The plant is expected to produce about 1.8 million metric tons of ethylene to be transformed into polyethylene in two facilities and into ethylene glycol in a third, all to be built on the site.

Even though some people in San Patricio County are less than thrilled with this decision, at least Gov. Greg Abbott is happy. Abbott, a key player behind the scenes in getting Exxon to build the plant in Texas, issued a statement on Wednesday celebrating the news: “This record-breaking project illustrates that our business climate is exactly what leading and growing companies are seeking when investing in their future."
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Dianna Wray is a nationally award-winning journalist. Born and raised in Houston, she writes about everything from NASA to oil to horse races.
Contact: Dianna Wray