Shell likely to re-enter PE but has not yet decided how - executive

14 March 2013 17:13  [Source: ICIS news]

LONDON (ICIS)--Shell is likely to re-enter the polyethylene business to help monetise ethylene and to tap into energy-efficiency led demand for the polymer, the oil and gas giant’s executive vice president for chemicals, Graham van’t Hoff said on Thursday.

“It’s more than possible that we will re-enter polyethylene,” he said.

Shell exited the polyethylene business when its polymers joint venture with BASF, Basell, was sold to Access Industries in 2005. Basell subsequently was merged with US producer Lyondell to create LyondellBasell.

Shell has said that it is studying a site near Monaca, Pennsylvania, in the US for an ethane cracker and that it is considering building polyethylene (PE) and monoethylene glycol (MEG) units at the site.

The attraction is strong polyethylene demand in the US northeast and the proximity of the brownfield site to Shell’s own shale exploration and production operations in the Marcellus field.

It said at the end of December 2012 that it had been granted a six-month extension to evaluate the construction site.

“We are not landed on any of these pieces,” van’t Hoff said of Shell’s investment decision on the Pennsylvania cracker or the possible re-entry into polyethylene. The company has also yet to decide whether it licenses PE technology or tries to do something else, he added.

Currently Shell only produces PE in two plants at its joint venture petrochemicals complex in Nanhai, southern China. Low density polyethylene technology was supplied by the then Basell.

Polyethylene would not be a core business in its own right, van’t Hoff said. “We look at polyethylene very much as a route to monetise ethylene,” he added.

By: Nigel Davis
+44 20 8652 3214

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