US may add 1.2m tonnes of ethylene capacity - consultant

24 March 2011 21:00  [Source: ICIS news]

HOUSTON (ICIS)--The US may add 1.2m tonnes of ethylene capacity through 2015 because of growing supplies of feedstock ethane, a consultant said on Thursday.

But no company has announced plans to add any of this capacity, said John Stekla, director of olefin studies for Chemical Market Associates Inc (CMAI).

Stekla made his comments during CMAI's World Petrochemical Conference.

Instead, the projection is from CMAI, which expects companies will add incremental capacity through 2015 -  to take advantage of the large spread between ethane and naphtha prices.

Companies will add this extra capacity by expanding existing crackers and by removing bottlenecks to production, he said.

After 2015, the US could build a new 1m tonne/year cracker in the Gulf coast, Stekla said. Another cracker could also be built.

Cheap ethane has boosted ethylene margins for North America, giving producers a big cost advantage against naphtha-based competitors.

"Ethane will continue to be a very advantaged feedstock," Stekla said. "A sustained ethane advantage appears to be very likely."

The CMAI conference lasts through Thursday.

For more on ethylene visit ICIS chemical intelligence

By: Al Greenwood
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