Dow Progresses its U.S. Gulf Coast Investments, Develops Plans for Performance Plastics Facilities


Dow Progresses its U.S. Gulf Coast Investments, Develops Plans for Performance Plastics Facilities

Shale Gas Advantage Positions Dow for Growth while Driving U.S. Economic Revitalization and Job Creation

MIDLAND, Mich.--(BUSINESS WIRE)-- The Dow Chemical Company (NYS: DOW) announced today that it intends to build several new, specialty material production units aligned to its high value Performance Plastics franchise on the U.S. Gulf Coast. The move further connects the Company's U.S. manufacturing operations with cost-advantaged feedstocks available from increasing supplies of shale gas in North America, while also creating thousands of new, high-paying jobs across the country's manufacturing sector.

Collectively, Dow expects the new Performance Plastics facilities will employ up to 3,000 workers at construction peak. Over the next five to seven years, Dow estimates that these projects, together with all other planned projects previously announced as part of the Company's comprehensive U.S. Gulf Coast investment plan, will employ approximately 5,000 workers during peak construction and support over 35,000 jobs in the broader U.S. economy.

"These new facilities will include a wide range of technologies that will produce differentiated, high performance materials for the fastest growing segments in Dow's existing markets, while providing access to new markets and applications," said Jim Fitterling, Dow Executive Vice President. "These investments are also aimed at businesses that have consistently delivered a higher return on capital, which is clearly aligned with our long-term strategy. This, coupled with an enhanced market and value chain focus in our high value Performance Plastics franchise, will deliver faster growth with lower earnings volatility."

Production Units Enter FEED Phase, Target Dow's Fastest Growing Markets

The new facilities are in the Front End Engineering and Design (FEED) phase that will be completed in 2014. These facilities will manufacture competitively advantaged materials for several of the Company's fastest growing market segments, including Packaging; Hygiene and Medical; Electrical and Telecommunications; Transportation, Sports and Leisure and Consumer Durables. The new capacity will be targeted at projected growth in North and South America in addition to select export opportunities over the coming decade. Dow is currently exploring specific location options on the U.S. Gulf Coast, with final investment locations to be determined at a later date.

Specific production units include the following:

  • Previously announced Next Generation NORDEL™ metallocene Ethylene Propylene Diene Monomer (EPDM) for Transportation, Infrastructure, Electrical & Telecommunications;

  • High Melt Index (HMI) Elastomers for Dow's AFFINITY™ brand of Hot Melt Adhesives;

  • ELITE™ Enhanced Polyethylene for high performance flexible packaging and hygiene & medical applications;

  • Specialty Low-density polyethylene (LDPE) to serve demand growth in packaging and electrical & telecommunications market segments.

Strategically Aligned Growth

These moves directly support Dow's transformational strategy to create additional competitive advantage for Dow's Performance businesses by expanding access to advantaged natural gas-based feedstocks. These new units will utilize building block materials from a new, previously announced ethylene production facility slated for start-up in 2017.

Dow Progresses Comprehensive U.S. Gulf Coast Growth Plan

Additional projects within the Company's U.S. Gulf Coast investment strategy are moving forward according to schedule.

Actions to improve ethane feedstock flexibility and increase ethylene supply at the Company's Louisiana Operations site in Plaquemine, La. in 2015 are progressing on schedule.

Construction work for a new propylene production facility at Dow Texas Operations commenced in January 2013, and the project is on track towards a scheduled start-up in 2015. The construction project is expected to create 1,300 jobs at its peak and will provide building blocks for Dow's epoxies and polyurethanes franchises.

Plans to construct a new, world-scale ethylene facility at Dow Texas Operations are progressing in alignment with Company targets. Dow's Board of Directors recently authorized capital to progress the project through detailed engineering and purchase long lead time equipment for the facility. This unit will be the primary supply to the newly announced Idemitsu / Mitsui joint venture.

In addition, an ethylene production unit at Dow St. Charles Operations successfully restarted in December 2012, meeting Company targets to re-start the plant by year-end 2012.

Dow also announced today an initial agreement for a long-term ethylene off-take arrangement with a new joint venture to be formed between Idemitsu Kosan Co., Ltd., and Mitsui & Co., Ltd., of Tokyo, Japan. Idemitsu and Mitsui will form the joint venture to construct and operate a world-scale, Linear Alpha Olefins unit on the U.S. Gulf Coast. The JV will utilize an integrated supply of ethylene from Dow's U.S. Gulf Coast production grid to produce Linear Alpha Olefins used as comonomers throughout Dow's high value Performance Plastics franchise.

About Dow

Dow (NYS: DOW) combines the power of science and technology to passionately innovate what is essential to human progress. The Company connects chemistry and innovation with the principles of sustainability to help address many of the world's most challenging problems such as the need for clean water, renewable energy generation and conservation, and increasing agricultural productivity. Dow's diversified industry-leading portfolio of specialty chemical, advanced materials, agrosciences and plastics businesses delivers a broad range of technology-based products and solutions to customers in approximately 160 countries and in high growth sectors such as electronics, water, energy, coatings and agriculture. In 2012, Dow had annual sales of approximately $57 billion and employed approximately 54,000 people worldwide. The Company's more than 5,000 products are manufactured at 188 sites in 36 countries across the globe. References to "Dow" or the "Company" mean The Dow Chemical Company and its consolidated subsidiaries unless otherwise expressly noted. More information about Dow can be found at

Note: The forward-looking statements contained in this document involve risks and uncertainties that may affect the Company's operations, markets, products, services, prices and other factors as discussed in filings with the Securities and Exchange Commission. These risks and uncertainties include, but are not limited to, economic, competitive, legal, governmental and technological factors. Accordingly, there is no assurance that the Company's expectations will be realized. The Company assumes no obligation to provide revisions to any forward-looking statements should circumstances change, except as otherwise required by securities and other applicable laws.

For editorial information:
The Dow Chemical Company
Nancy Lamb, 989-638-7251

KEYWORDS: United States North America Michigan


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