Citing increased costs of design, construction, operation and uncertainties land ownership in Brazil, Dow Chemical Co. and Mitsui & Co Ltd. postponed their plans for deploying a production of polyethylene from ethanol in Santa Vitória, Minas Gerais.
The complex, whose start-up was originally scheduled for the end of 2013, has an estimated investment of around $ 1.5 billion and also provides for the expansion of plantations of sugar cane and the construction of an ethanol plant with capacity to process 2.7 million tonnes of cane, whose implementation will continue as schedule. The joint venture Dow-Mitsui today cultivates an area of 20 thousand hectares of sugar cane and hopes to have its first harvest complete in 2014.
In the short term, the Dow will focus on more profitable investments, particularamente development units based on shale gas in the United States. The Dow is investing $ 4 billion in the Gulf Coast of Mexico to expand its production capacity of polyolefins by 2017. The availability of large shale gas reserves in the United States significantly reduces the cost of production of polyolefins.