US LyondellBasell open to building gas fractionation unit

29 July 2011 20:51  [Source: ICIS news]

HOUSTON (ICIS)--US chemical giant LyondellBasell may eventually build its own gas fractionation unit to combat stubbornly high ethane prices, the company's CEO said on Friday.

However, the pending addition of capacity may help alleviate higher prices, said LyondellBasell chief executive Jim Gallogly during the company's second quarter earnings conference call.

Enterprise Products and Targa Resources are expected to add about 40,000 barrels/day of ethane capacity each in the near future, he said.

“There are also some various things being talked about in the Marcellus [shale],” Gallogly said. “Maybe in 2012 there will be another 100,000 barrels/day. So we see there is quite a bit of capacity coming in, but we remain open to good financial opportunities.”

Prices for ethane remain high because most of the major crackers in the US are operating at a high efficiency, with few breakdowns, Gallogly added. “Having said all that, we remain open to the concept, if necessary, of building our own fractionation.”

For more on LyondellBasell, visit ICIS company intelligence

By: Bobbie Clark
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