By Sheila Dang
HOUSTON (Reuters) – Exxon Mobil said on Wednesday it will spend $100 million to upgrade its Baton Rouge, Louisiana, chemical plant to produce a highly pure form of isopropyl alcohol that is used in the tech industry to clean and process microchips.
The move comes as the development of advanced artificial intelligence is spurring a boom in the chip industry, with companies building data centers that house huge troves of specialized chips and tech giants developing in-house chips to train AI systems.
The chemical plant upgrade, which will be completed by 2027, will allow Exxon to produce more high-purity isopropyl alcohol and meet the growing demand from U.S. tech companies, said Frederik Donkers, vice president of intermediates at Exxon.
“It will create production at scale and allow us to support the fabs that are under construction in the U.S.,” he said.
Production of the highly pure isopropyl alcohol will be geared toward U.S.-based customers, as exporting it over longer distances internationally could introduce risks to the purity level, Donkers said.
Exxon declined to say if it has signed new customer agreements to supply the isopropyl alcohol.
U.S. companies have sourced highly pure isopropyl alcohol from Taiwan and Japan, because domestic suppliers did not meet their needs, according to SEMI, a semiconductor trade association, in 2021 public comments to the U.S. Department of Commerce.
(Reporting by Sheila Dang in Houston; Editing by Leslie Adler)
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