Mergers & Acquisitions

Motiva to acquire Flint Hills Resources’ chemical plant in Port Arthur, Texas

Motiva to acquire Flint Hills Resources’ chemical plant in Port Arthur, Texas
Photo courtesy of Motiva

Motiva Enterprises LLC, which is 100% owned by affiliates of Saudi Aramco, announced yesterday that it has signed an agreement to acquire the chemical plant owned by Flint Hills Resources in Port Arthur, Texas, U.S.A., located next to Motiva’s oil refinery. 

Motiva owns and operates North America’s largest oil refinery in Port Arthur, Texas, with a crude capacity of more than 630,000 barrels a day. The company also operates the country’s largest lubricant blending plant. Headquartered in Houston, Texas, Motiva markets petroleum products at more than 5,000 retail gasoline stations in the United States, under exclusive, long-term brand licenses for the Shell and 76® brands.

Motiva plans to operate the chemical plant while it builds petrochemical units within its Port Arthur complex, as part of a USD18 billion expansion along the U.S. Gulf Coast, according to Reuters.  The Flint Hills chemical plant currently purchases petrochemical feedstock from the Motiva refinery.

The acquisition is targeted to close in the fourth quarter of 2019, subject to meeting all of the closing conditions. Terms of the transaction were not disclosed. Flint Hills purchased the chemical plant from the Huntsman Corp. in 2007 for USD770 million.

The Flint Hills chemical plant operates a 1.57 billion-pound-per-year ethylene cracker, a unit producing nylon component cyclohexane, and a network of pipelines and storage caverns. Saudi Aramco, through its U.S. refining arm, has been investing heavily in the Port Arthur area since acquiring Shell’s stake in the Motiva joint venture. It has filed documents with the state of Texas to build a USD5 billion steam cracker that would produce ethylene. A final investment decision is expected by year-end or early 2020, Reuters said.

Flint Hills Resources is an industry leader in refining, chemicals, and biofuels and ingredients, with operations primarily in Texas and the U.S. Midwest. The company has expanded its operations through capital projects and acquisitions worth more than USD15 billion since 2002. Flint Hills Resources’ subsidiaries produce and market gasoline, diesel fuel, jet fuel, asphalt, ethanol, biodiesel, liquefied natural gas, olefins, polymers, intermediate chemicals, as well as lubricating base oils, distillers corn oil and distillers grains. Based in Wichita, Kansas, U.S.A., the company has more than 4,000 employees and is a wholly-owned subsidiary of Koch Industries, Inc.

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