18 November 2011 17:02 [Source: ICIS news]
(recasts paragraph 10 by adding "and other suppliers")
HOUSTON (ICIS)--Shell is still only in the early stages of plans to develop an ethane cracker in the ?xml:namespace>
While the company hopes to announce a potential site for the cracker in January, a final investment decision will depend on a number of factors, said Dan Carlson, general manager of new business development for Shell Chemicals in the
These factors include the project’s fit with Shell’s overall strategy, derivative plans, profitability, the regulatory environment and “the robustness to changes in the assumptions,” Carlson said.
Carlson said that in determining a suitable site in either Pennsylvania, West Virginia or Ohio, Shell is looking at good access to the ethane-rich shale gas region of Marcellus; water and rail infrastructure; power grids; underground storage facilities; availability, skills and cost of local workforce; regulatory requirements; and enough acreage to accommodate its facilities and allow for potential future growth.
“The cost and ease of doing business in a particular state or county will definitely play a role in this project’s success in keeping ethane in the region,” he added.
Carlson would not discuss how much Shell may invest in the project. However, a typical world-scale cracker and derivatives complex would cost several billion dollars to develop, he said.
If the project goes ahead, Shell would want to own and operate the cracker, Carlson said.
“We are currently exploring different options with third parties on what the entire value chain will look like, that is, the most efficient means of gathering, processing and extracting ethane,” he said.
“At this point I can’t go into more detail,” he added.
Shell’s cracker would tap into feedstock made available from Shell’s shale gas acreage and other suppliers in the Marcellus field, which extends through
In related news, an executive with LyondellBasell this week voiced skepticism over the many announcements for new ethane cracker projects in the US on the back of the shale gas boom. LyondellBasell said previouly it would focus on debottlenecking projects in the US before considering new investments.
Meanwhile, Canada-based NOVA Chemicals has contracted with producers in the Marcellus Shale to ship ethane to its petrochemicals complex at Corunna in southern,
Additional reporting by Lane Kelley and Sheena Martin
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