Axiall Selects Louisiana as Site of Contemplated Ethylene Cracker
ATLANTA--(BUSINESS WIRE)--Dec. 19, 2013-- Axiall Corporation (NYSE: AXLL) today announced that the company has selected the state of Louisiana as the location of a possible world-scale ethylene cracker to be built in conjunction with a related derivatives plant. Axiall proposes to construct the facility with a soon-to-be-named partner, and Axiall’s contemplated capital investment in the project would be approximately $1 billion. Axiall expects to finance its portion of the investment with a combination of new debt and cash on hand. The combination of Axiall’s approximately $1 billion investment with approximately $2 billion from a partner could result in a total capital investment approaching $3 billion.
Axiall is a leading chemicals and building products company with major manufacturing facilities in Louisiana – two in the Lake Charles area and another in Plaquemine.
“As part of Axiall’s long-term growth strategy, we believe it is important we have further integration with cost-based economics on 50 percent of our current annual ethylene requirements,” said President and CEO Paul Carrico. “While we are still considering a number of options and potential partners for the project, and we have not yet received final investment approval from our Board of Directors, we have narrowed our siting choices to Louisiana. We are excited about the prospect of expanding our footprint in the state of Louisiana and continuing to invest in its talented workforce.”
Carrico said Axiall would begin the permitting process and certain front-end engineering design activities “as the next steps in our process to select a final site for the project.” Carrico added that Axiall is evaluating possible partners for both the ethylene and derivative portions of this potential project and it expects to announce a partner in the near future.
If Axiall chooses to move forward with construction of an ethylene cracker and gains board approval, commercial operation could begin in 2018. The company projects that an ethylene cracker alone would create between 150 and 175 permanent full-time jobs once operational; a related derivatives plant would increase the number of new permanent full-time jobs to 225-250. Thousands of additional construction jobs would be created during a four-to-five year period.
Axiall Corporation is a leading integrated chemicals and building products company. It is an international manufacturer of chlor-alkali and derivatives, chlorovinyls and aromatics products including chlorine, caustic soda, vinyl chloride monomer, chlorinated solvents, calcium hypochlorite, ethylene dichloride, muriatic acid, phosgene derivatives, polyvinyl chloride, vinyl compounds, acetone, cumene and phenol. It also manufactures vinyl-based building and home improvement products that are marketed under Royal Building Products, Celect™, Zuri™, Kor Flo™, Overture, S4S and Exterior Portfolio brands, including window and door profiles, mouldings, siding, pipe and pipe fittings, and decking. Axiall, headquartered in Atlanta, Georgia, has manufacturing facilities located throughout North America and in Asia to provide industry-leading materials and services to customers.
Cautionary Statements About Forward-Looking Information
This press release contains certain statements relating to future events and our intentions, beliefs, expectations, and predictions for the future. Any such statements other than statements of historical fact are forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Words or phrases such as "anticipate," "believe," "plan," "estimate," "project," "may," "will," "intend," "target," "expect," "would" or "could" (including the negative variations thereof) or similar terminology used in connection with any discussion of future plans, actions or events generally identify forward-looking statements. These statements relate to, among other things: (i) the anticipated location of an ethylene cracker and related derivatives plant (the “New Facilities”) that might be constructed with a soon-to-be-named partner; (ii) Axiall’s plans, objectives, expectations and intentions regarding, and the expected impact and benefits of, the New Facilities; (iii) the amount of the capital investment that might be made by Axiall and a soon-to-be-named partner in connection with the possible construction of the New Facilities; (iv) the anticipated date for the possible commencement of operations of the New Facilities; and (v) the number of jobs expected to be created thereby. These statements are based on the current expectations of our management. There are a number of risks and uncertainties that could cause our actual results and timing to differ materially from the forward-looking statements included in this press release. These risks and uncertainties include, among other things: (i) Axiall's inability to: (a) locate a suitable partner for the New Facilities and negotiate the terms and conditions of such partnership on commercially acceptable terms or at all; (b) secure a commercially acceptable site for the New Facilities in Louisiana on commercially reasonable terms or at all and complete the related permitting process and front-end engineering design activities in a timely manner or at all; (c) fund or obtain financing for its capital investment in the New Facilities on commercially acceptable terms or at all; (d) obtain the approval of its Board of Directors to enter into any arrangements with a soon-to-be-named partner or otherwise construct or finance the New Facilities, or (e) successfully integrate any ethylene cracker or realize expected cost savings or synergies therefrom; and (ii) uncertainties regarding future prices, industry capacity levels and demand for Axiall’s products, raw materials and energy costs and availability, feedstock availability and prices, changes in governmental and environmental regulations, the adoption of new laws or regulations that may make it more difficult or expensive to operate Axiall’s businesses or manufacture its products, Axiall’s ability to generate sufficient cash flows from its business, future economic conditions in the specific industries to which its products are sold, and global economic conditions.
In light of these risks, uncertainties, assumptions, and factors, the forward-looking events discussed in this press release may not occur. Other unknown or unpredictable factors could also have a material adverse effect on Axiall’s actual future results, performance, or achievements. For a further discussion of these and other risks and uncertainties applicable to Axiall and its business, see Axiall’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, and subsequent filings with the SEC. As a result of the foregoing, readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Axiall does not undertake, and expressly disclaims, any duty to update any forward-looking statement whether as a result of new information, future events, or changes in its expectations, except as required by law.
Source: Axiall Corporation
Martin Jarosick, 770-395-4524
Alan Chapple, 770-395-4538