SUGAR LAND, Texas, June 6, 2016 /PRNewswire/ -- Trecora Resources (NYSE: TREC), a leading provider of high purity specialty hydrocarbons and waxes, today announced it has received permission from the Texas Commission on Environmental Quality to construct and operate a 4,000 barrels per day reformer unit at its South Hampton Resources (SHR) subsidiary in Silsbee, Texas.
The new reformer unit further supports the recently completed D-Train expansion, and utilizes Chevron Phillips Chemical Company's proprietary Aromax® Process that was originally tested and proven for commercial application at SHR's Silsbee facility. The Aromax® Process is ideally suited to the C6+ streams available to SHR through its integrated, natural gasoline-based high purity pentane and hexane production trains.
Simon Upfill-Brown, Trecora's President and Chief Executive Officer, commented, "The Aromax® Process unit will produce a significantly higher value byproduct stream compared with our existing reformer. In addition, the new reformer will provide a secure and reliable source of hydrogen for SHR's high purity pentane production and custom processing activities. With these benefits, we remain positioned to meet increased long–term pentane demand while also achieving a near-term payback on the project. In recent quarters we have sold our byproduct volume at average prices below our feedstock cost, which significantly impacted our gross margins. We expect the Aromax® Process benzene, toluene and xylene (BTX) byproduct stream to be sold well above feedstock costs."
The capital investment for this project is estimated at $45 - $50 million and will be financed by existing sources of funds. The site of the reformer unit has been cleared and construction will begin immediately. The Company expects to complete the project in the second quarter of 2017.
About Trecora Resources (TREC)
TREC owns and operates a facility located in southeast Texas, just north of Beaumont, which specializes in high purity hydrocarbons and other petrochemical manufacturing. TREC also owns and operates a leading manufacturer of specialty polyethylene waxes and provider of custom processing services located in the heart of the Petrochemical complex in Pasadena, Texas. In addition, the Company is the original developer and a 35% owner of Al Masane Al Kobra Mining Co., a Saudi Arabian joint stock company.
Statements in this press release that are not historical facts are forward looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based upon our belief, as well as, assumptions made by and information currently available to us. Because such statements are based upon expectations as to future economic performance and are not statements of fact, actual results may differ from those projected. These risks, as well as others, are discussed in greater detail in Trecora Resources' filings with the Securities and Exchange Commission, including Trecora Resources' Annual Report on Form 10-K for the year ended December 31, 2015, and the Company's subsequent Quarterly Reports on Form 10-Q. All forward-looking statements included in this press release are based upon information available to the Company as of the date of this press release.
Investor Relations Contact:
The Piacente Group
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SOURCE Trecora Resources