INEOS Acetyls, part of British conglomerate INEOS Group, and Houston-based Sandpiper Chemicals will jointly develop one of the first blue methanol facilities in the United States, a $1.7 billion project in Texas City that would produce 1.1 million tonnes of low-carbon methanol annually when it comes online in 2030.
The new facility will be located at INEOS’s existing Texas City site, benefiting from already established petrochemical infrastructure and skilled workforce, as well deep-water port access, according to the official announcement made earlier this week.
Under the agreement, INEOS will become both a shareholder and an anchor customer of Sandpiper, consuming up to 300,000 tonnes per year of the facility’s output for its own acetic acid production.
The plant will use natural gas combined with carbon capture and storage (CCS) technology targeting a capture rate of 97% of process carbon dioxide (CO2) emissions, with a carbon intensity designed to fall significantly below conventional methanol benchmarks.
The project is scheduled to enter the front-end engineering and design (FEED) phase in the second quarter of 2026, with a final investment decision (FID) targeted for 2027 and first production anticipated in 2030.
“Low-carbon methanol is increasingly recognized as a critical fuel and feedstock for the maritime, chemical, and energy sectors,” said Declan Sealy, Business Director at INEOS Acetyls, adding that the move is expected to position the companies “at the forefront of a rapidly growing global market for sustainable fuels.”
Relevant: INEOS Awards Score Major Carbon Capture Contracts For Project Greensand
Global methanol demand exceeds 100 million metric tons annually, with low-carbon variants forecast to grow substantially over the coming decade, driven by adoption as a marine fuel under decarbonization mandates and expanding chemical manufacturing applications.
Texas City’s proximity to Gulf of Mexico shipping lanes adds commercial advantage to the site, INEOS noted.
The initiative, which will be Sandpiper’s third methanol project, is expected to generate around 1,500 construction jobs at peak activity and 25 permanent positions upon commissioning, alongside significant tax revenues for Galveston County and the State of Texas.
Read more: ExxonMobil Eyes Texas Expansion With New Carbon Storage Project
