Axiall Corporation a leading integrated chemicals and building products company as part of Axiall’s growth strategy, on Dec.19, 2013 had announced its intention to find a partner to build the potential cracker. Following which, Axiall Corp. and Lotte Chemical of the Republic of Korea announced that they have inked a 50-50 joint venture agreement for the design, construction, and operation of a proposed 1 million tonne/year ethane cracker to be built in Louisiana.

The companies expect to jointly award a front-end engineering design (FEED) contract for the cracker in first-quarter 2014. In addition, Lotte Chemical would begin a FEED study for a wholly owned monoethylene glycol plant to be built adjacent to the potential cracker.

Both plant could begin commercial operation in 2018, if the projects are approved by each company’s board, Axiall said.

Axiall believe it is important to have further integration with cost-based economics on 50% of their annual ethylene requirements, as part of it’s long-term growth strategy, said Paul Carrico, Axiall president and chief executive officer.

Lotte Chemical has a global presence in the chemicals industry, and the fact that it currently operates three crackers with more than 2.8 million tonnes of ethylene capacity worldwide demonstrates that Lotte Chemical would be a strong and experienced partner in this important strategic investment, Carrico added.

While no new cost estimates were disclosed, Axiall previously estimated a total capital investment of about $3 billion for the project, with Axiall’s portion amounting to around $1 billion.

Formed by a merger of Georgia Gulf Corp. and the commodity chemicals business of PPG Industries in January 2013, Axiall already holds three manufacturing plants in Louisiana, two of which are in the Lake Charles area, with another in Plaquemine.

Soo Young Huh, president and chief executive officer of Lotte Chemical said that they are pleased to enter this partnership with Axiall to develop a world-scale ethane cracker fed by U.S. shale gas. This investment will build on Lotte Chemical’s global ethylene construction and operating capabilities and increase our manufacturing presence in the North American market.