PTT, Marubeni become 3rd group to mull US northeast cracker

Author: Al Greenwood

2015/04/22

PTT Global, Marubeni mull Ohio site for possible US cracker(adds paragraphs 1, 5-27)

HOUSTON (ICIS)--PTT Global and Marubeni are the third group considering a cracker in the northeast US to take advantage of the ethane being produced in the Marcellus and Utica shales, a governor said on Wednesday.

According to the governor’s office of Ohio, the companies are looking at a site in Belmont county, Ohio, for a world-scale ethane cracker.

The press release said that the two companies will take the next 12-16 months to complete the engineering design and permitting.

The companies are expected to make a formal investment decision in 2016, with construction scheduled to take place in 2017 if the decision to build the unit is made.

The advent of shale gas has changed the fortunes of the northeast US, turning it into a sudden source of ethane and other natural gas liquids (NGLs) for petrochemical plants.

Shell was the first of the three to announce plans for a possible cracker in the northeast.

If the company proceeds with the project, it would be built in Monaca, Pennsylvania, near Pittsburgh.

The cracker could produce 1.5m tonnes/year, Shell said in an air-permit application. The company may also build three polyethylene (PE) units that would have a combined capacity of 1.6m tonnes/year, Shell said.

Two of the 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.

Operations could start in 2018, Shell said in the application.

In addition to Shell's project, 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.

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.

Sunoco also announced plans to build a propane dehydrogenation (PDH) unit at Marcus Hook, which would produce propylene. The company has not announced capacity or start-up dates for the plant.

Additional reporting by John Dietrich