AFPM '12: US can support more PDH units – Williams manager

02 April 2012 00:32  [Source: ICIS news]

SAN ANTONIO, Texas (ICIS)--The US could support more propane dehydrogenation (PDH) plants because feedstock for the units will likely be cheap and supplies of propylene will likely be tight, a manager for Williams said on Sunday.

"We think there is a potential for more than what has been announced," said Kelly Knopp, general manager, natural gas liquids (NGLs) and olefins marketing for Williams. "We think it makes tremendous sense in the US," Knopp said.

He made his comments on the sidelines of the International Petrochemical Conference, hosted by the American Fuel & Petrochemical Manufacturers (AFPM).

PDH units make propylene by using propane as a feedstock.

Propane supplies are increasing because of the advent of shale gas.

Already, US propane is among the cheapest in the world, said Michael Cleveland, business director, petrochemicals, process technology and equipment, UOP. UOP sells technology and catalysts to petrochemical plants and refineries.

As the US increases natural gas production, it will also produce more propane, Knopp said.

So far, PetroLogistics owns the sole PDH plant in the US.

Dow Chemical plans to build up to two PDH plants. Production for the first unit should start in 2015.

Formosa Plastics plans to build a 600,000 tonne/year PDH plant, with operations starting in 2016.

Until those PDH units start production, US propylene will likely remain tight, Knopp said.

Supply is tight because US crackers are using lighter natural-gas-based feedstock.

Supplies from refiners are declining because companies are reducing capacity.

Refiners have shut down two plants on the east coast, and a third could be closed this summer.

Earlier this year, refiners chose to use their propylene to make alkylate, a gasoline blendstock, instead of selling it to petrochemical producers.

The IPC lasts through Tuesday.

By: Al Greenwood
+1 713 525 2645

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