US Gulf ethane production brings investment for new projects

17 April 2012 06:28  [Source: ICIS news]

NEW ORLEANS, Louisiana (ICIS)--Higher production of natural gas liquids (NGL) from the US Gulf Eagle Ford shale basin, and the resulting rise in the use of ethane as petrochemical feedstock, has led to significant investment in new plants and innovative facilities, an energy consultant said on Monday.

Several producers are converting their ethylene plants to using lighter feedstocks such as ethane, instead of naphtha, and have plans to produce propylene and butadiene, said Lesa Adair, vice president and chief financial officer of Muse, Stancil & Co.

She was speaking at the sidelines of the Gas Processors Association (GPA) annual meeting in New Orleans held on 15-18 April.

NGL production in the Eagle Ford shale basin has increased by about 40,000 bbl/day since drilling began in 2009, Adair said. Muse, Stancil & Co’s forecast shows an increase in NGL production to more than 300,000 bbl/day by 2020.

Demand for ethane is expected to swell to 430,000 bbl/day in the US Gulf by 2018 as a result of ethylene plants expansions, feedstock conversions and new plants coming on stream, said Adair.

Taiwan-based Formosa Plastics Corp (FPC) plans to convert its ethylene plants at Point Comfort in Texas from using naphtha to ethane feedstock, while BASF is adding flexibility at its plants for light feedstocks, said Susan Starr, a principal at Muse, Stancil & Co.

The increased use of ethane feedstock for ethylene plants has reduced the output of propylene and butadiene (BD), which are by-products of naphtha cracking, Starr said.

As a result, petrochemical firms have plans to build four to five propane dehydrogenation plants and one or two butane dehyrogenation plants by 2020 for the production of propylene and BD.

Another option would be to use propylene metathesis, a process by which ethylene is turned into propylene, said Starr.

By: Sheena Martin
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