Shell gets approval for US petchem complex

HOUSTON (ICIS)–The Pennsylvania Department of Environmental Protection (DEP) has approved Shell’s air-permit application for a proposed petrochemical complex in western Pennsylvania, the regulator said on Monday.

The complex will include an ethane cracker with a capacity of 1.5m tonnes/year and three polyethylene (PE) units which would have a combined capacity of 1.6m tonnes/year.

Shell has yet to reach a final decision to build the project.

Two of the PE plants will be gas-phase units, each with a capacity of 550,000 tonnes/year. The third plant will be a slurry unit with a capacity of 500,000 tonnes/year.

Earlier, Shell had closed on its land purchase in Monaca, Pennsylvania.

Shell is among a handful of companies that are considering ethane crackers in the northeastern US to take advantage of growing supplies of natural-gas liquids (NGL).

This year, PTT Global and Marubeni became the third group to consider a cracker in the region. The two companies will take the next 12-16 months to complete the engineering design and permitting. The companies are expected to make a final investment decision in 2016, with construction scheduled to take place in 2017 if the decision to build the unit is made.

Odebrecht and Braskem are also considering a petrochemical complex called ASCENT (Appalachian Shale Cracker Enterprise). It would be built in Wood county, West Virginia, and operations may start after 2020.

The companies are now revaluating the project and have yet to make a final investment decision. Odebrecht and Braskem have not announced the capacity of ASCENT but it would likely match the scope of the Ethylene XXI project that Braskem is developing in Mexico with partner Grupo Idesa.

Ethylene XXI involves a 1.05m tonne/year cracker, two high density PE (HDPE) plants with capacities of 350,000 tonnes/year and 400,000 tonnes/year, as well as one 300,000 tonne/year low density PE (LDPE) plant.

While the northeast US is far from the nation’s petrochemical hub in the Gulf coast, it is close to the PE demand in the US.

In addition, midstream companies continue to build the processing plants and fractionators needed to extract ethane and other NGLs from the gas produced in the Marcellus and Utica.

MarkWest continues to announce new processing plants for the region – despite the recent declines in energy prices.

However, the northeast lacks the NGL storage capacity of the Gulf coast, and the NGLs being produced in the region are no longer stranded.

NOVA Chemicals is already cracking Marcellus ethane at its Corunna cracker in Sarnia, Ontario, in Canada. An expansion project taking place in 2017 could allow NOVA to crack even more ethane from the northeast.

In 2014, Enterprise Products started delivering ethane to the Gulf coast from its Appalachia-to-Texas Express (ATEX) ethane pipeline.

Meanwhile, Sunoco Logistics plans to export ethane overseas from its terminal in Marcus Hook, Pennsylvania. By mid-2015, ethane and propane should start arriving at Marcus Hook through a 70,000 bbl/day pipeline, Sunoco Logistics said.

The company plans to expand its pipeline capacity to Marcus Hook through its Mariner East 2 project.

Under Mariner East 2, Sunoco will expand its pipeline capacity by 275,000 bbl/day, bringing total capacity to 345,000 bbl/day. The expansion project should start operations by the end of 2016, the company said.