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Orion Announces Plans to Build Only Acetylene-based Conductive Additives Plant in U.S.
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Orion Engineered Carbons (NYSE: OEC) has announced plans to construct a facility in La Porte, Texas, dedicated to producing acetylene-based conductive additives, crucial for lithium-ion batteries and high-voltage cables. The investment, ranging from $120 million to $140 million, aims to increase production capacity by approximately 12 kilotons annually, with operations expected to commence in late 2024. This initiative seeks to meet the rising demand for battery materials and contribute to local job creation.
Positive
Investment of $120 million to $140 million for a new facility in Texas.
Expansion will quadruple manufacturing capacity of acetylene-based conductive additives.
New technology and high-skilled jobs will be introduced to the local community.
Demand for battery additives is expected to surge amid a global boom in lithium-ion battery production.
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None.
HOUSTON--(BUSINESS WIRE)--
Orion Engineered Carbons (NYSE: OEC), a specialty chemical company, today announced plans to build the only plant in the U.S. producing acetylene-based conductive additives – a critical link in the value chain for lithium-ion batteries, high-voltage cables and other products powering the global transition to electrification and renewable energy.
Orion’s planned facility in La Porte, Texas, south of Houston, will be backed by a long-term agreement for acetylene supplied from a neighboring site owned by Equistar Chemicals LP, a subsidiary of LyondellBasell.
Acetylene is a colorless gas widely used as a chemical building block. Orion’s production process turns acetylene into a powder, which is added to lithium-ion batteries, enhancing electrical conductivity and extending the lifetime of the most valuable component of an electric vehicle. The material plays a similar role in high-voltage cables used for wind and solar farms.
Orion will invest between $120 million to $140 million in the facility, expected to start up in the second half of 2024. This investment should increase the company’s conductive additives capacity by approximately 12 kilotons per year.
“With this investment, we will quadruple our effective manufacturing capacity of acetylene-based conductive additives,” said Corning Painter, Orion’s CEO. “We are already experiencing high demand for this material, so expanding capacity for it is one of our top investment priorities and a major milestone in our growth plans. This is a very big day for Orion.”
The company, which has a similar plant in France with locally supplied acetylene gas from LyondellBasell, is the sole producer of acetylene-based conductive additives in the European Union. The U.S. plant will bring new technology and high-skilled jobs to the country and positively impact long-term job creation for the local community. Demand for battery additives is expected to grow rapidly amid a global boom in the construction of gigafactories making lithium-ion batteries.
The plant will have a favorable environmental profile and will be subject to obtaining the routine regulatory approvals.
“Batteries will continue to play an increasingly vital role in the world’s shift toward clean energy,” Painter said. “By being a key supplier of materials to the battery industry, we’re living up to our mission of delivering solutions for a more sustainable future.”
Orion will hold its first quarter earnings conference call tomorrow, Friday, May 6, 2022, at 8:30 a.m. (EDT) where additional details of this announcement will be provided. The dial-in details for the live conference call are as follows:
U.S. Toll Free:
1-877-407-4018
International:
1-201-689-8471
A replay of the conference call may be accessed by phone at the following numbers through May 12, 2022:
U.S. Toll Free:
1-844-512-2921
International:
1-412-317-6671
Conference ID:
13727988
About Orion Engineered Carbons
Orion Engineered Carbons (NYSE: OEC) is a leading global supplier of carbon black, a solid form of carbon produced as powder or pellets. The material is made to customers’ exacting specifications for tires, coatings, ink, batteries, plastics and numerous other specialty, high-performance applications. Carbon black is used to tint, colorize, provide reinforcement, conduct electricity, increase durability, and add UV protection. Orion has innovation centers on three continents and 14 plants worldwide, offering the most diverse variety of production processes in the industry. The company’s corporate lineage goes back more than 160 years to Germany, where it operates the world’s longest-running carbon black plant. Orion is a leading innovator, applying a deep understanding of customers’ needs to deliver sustainable solutions. For more information, please visit orioncarbons.com.
Forward-Looking Statements
This document contains certain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements of future expectations that are based on current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement. New risk factors and uncertainties emerge from time to time and it is not possible to predict all risk factors and uncertainties, nor can we assess the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information, other than as required by applicable law.
Wendy Wilson Head of Investor Relations
Orion Engineered Carbons Direct: +1 281-974-0155
wendy.wilson@orioncarbons.com
William Foreman Director of Corporate Communications and Government Affairs
Orion Engineered Carbons Direct: +1 832-445-3305
Mobile: +1 281-889-7833
william.foreman@orioncarbons.com
Source: Orion Engineered Carbons S.A.
FAQ
What is Orion Engineered Carbons planning to build in Texas?
Orion Engineered Carbons is planning to build a facility in La Porte, Texas, to produce acetylene-based conductive additives.
How much will Orion invest in the new facility?
Orion Engineered Carbons will invest between $120 million and $140 million in the new facility.
When is the new facility expected to start operations?
The new facility is expected to start operations in the second half of 2024.
What capacity increase will the new facility provide?
The new facility will increase Orion's capacity for conductive additives by approximately 12 kilotons per year.
Why is the new plant significant for Orion Engineered Carbons?
The new plant will allow Orion to meet the high demand for conductive additives used in lithium-ion batteries and support the global transition to renewable energy.
