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Analysis: Dow, DuPont merger expands footprint of ethylene’s largest USGC producer
On Friday, Dow Chemical and DuPont announced the two companies would merge, creating DowDuPont.
The new company would be spun off into three independent firms with material sciences, of which chemicals would fall under, being the largest of these with a combined 2014 revenue of $51 billion.
But looking at this ‘merger of equals,’ as the two companies have described the deal, through the narrow viewpoint of US ethylene production brings a different result.
Dow has a total US Gulf Coast ethylene production capacity of 9.1 billion lb/yr, about 15% of total US Gulf Coast capacity. DuPont has about 1.5 billion lb/yr, or 2.38%. Without DuPont’s one cracker in Orange, Texas, Dow is already the largest ethylene producer along the USGC based on total capacity --- even though it is still short ethylene overall --- with ExxonMobil Chemical coming in second, just 0.3 billion lb/yr behind. DowDuPont will only enhance that standing with the combined entity holding nearly 18% of total ethylene capacity in the region (see graph below). --Samantha Hartke
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