Shell reaches engineering milestone in Northeast
Shell has completed a substantial step in the construction of its Pennsylvania Petrochemicals Complex, bringing the Northeast chemicals hub dream another step closer to reality.
Shell said on October 10, 2018 it had successfully installed the project's largest piece of equipment: a 285-foot cooling and condensation tower for gas and other hydrocarbons.
At approximately 2,000 tonnes, the tower spent more than three and a half weeks in transit up the Mississippi and Ohio rivers and required one of the world’s largest cranes to lift it into place.
Upon arrival in Pennsylvania, it was unloaded onto a dock and transported down a newly-created road – both specially-designed to handle the large quench tower.
The heavy lift of the quench tower, undertaken October 7, marked an important milestone in the project.
Complex Timeline
In May 2018, Shell introduced its Shell Polymers line of business to customers.
Shell took the final investment decision on the Pennsylvania Petrochemicals Complex in June 2016.
The site preparation program ended in November 2017, with Shell announcing the start of main construction. Commercial production is expected to begin early next decade.
Since the start of main construction in November 2017, Shell has also safely erected two of three reactors associated with the planned polyethylene units and laid around 15 miles of underground pipe for the cooling, firewater and drainage systems.
The project is bringing economic growth and jobs to the region, with some 3,000 workers on site. That number will likely increase to 6,000 by the end of 2019 through its construction phase.
Shell expects around 600 onsite jobs when the complex is completed.
“Eleven months into main construction, I’m delighted with the progress we’re making in Pennsylvania,” said Graham van’t Hoff, Executive Vice President for Shell’s global chemicals business in a company statement.
“It’s great to see our world-class complex taking shape. The project is providing more economic opportunities in Pennsylvania and the region.”
Complex Details
The petrochemicals complex will use ethane from shale-gas producers in the Marcellus and Utica basins to produce 1.6 million tonnes of polyethylene per year.
The complex will include four processing units – an ethane cracker and three polyethylene units. Two polyethylene units will manufacture high-density polyethylene (HDPE) grades of pellets and a third unit will produce linear low-density polyethylene (LLDPE) pellets.
Shell is also constructing a 900-foot (274-metre) cooling tower, rail and truck loading facilities, a water treatment plant, an office building and a laboratory.
Northeast Conditions
The Shell petrochemical complex in Pennsylvania will be the first major U.S. project of its type to be built outside the Gulf Coast in 20 years, but many say Shell is paving the way for a major Appalachia petrochemical industry.
The Northeast region has lagged the U.S. Gulf Coast in petrochemical developments since the Shale Renaissance building boom began despite ample supplies of natural gas from the Marcellus and Utica shale formations which span Pennsylvania, Ohio and New York.
There is enough ethane being produced in the Northeast U.S. now to provide the chemical industry enough feedstock without any additional drilling or exploitation, industry analysts said.
“There is more than enough ethane in the Northeast region now for another two to three world scale crackers,” U.S. Energy Information Administration Industry Economist Warren Wilczewski said while speaking at Petrochemical Update’s Northeast U.S. Petrochemical Construction Conference in 2017.
A report by IHS Markit in 2018 later stated that a rise in the production of ethane in the Northeast could be enough to supply an additional four crackers to generate ethylene for plastics manufacturing.
Surging supply of ethane is expected to come from the Marcellus and Utica shales over the next several years. By 2020, a quarter of U.S. ethane will be produced in Appalachia, according to the U.S. Energy Information Administration (EIA).
Still Needed
Pipelines, infrastructure and storage are still necessary for the northeast petrochemicals hub to become a reality, players caution.
According to analysts, a storage solution is a crucial next step in transforming the Appalachian Basin and its natural gas assets into a petrochemical production center.
A proposed multibillion-dollar regional storage complex for natural gas liquids sourced from the Marcellus, Utica and Rogersville shale plays moved one step closer to reality in August when Parsons was named engineering, procurement and construction (EPC) partner for the buildout of the Appalachia Storage and Trading Hub (ASTH).
Parsons will initially focus on the pre-front end engineering design (FEED) and FEED stages including project management and execution planning. Subsequent phases would include constructing the $3.4 billion project and its long-term operation.
The American Chemistry Council (ACC) has estimated that the ethane storage hub would act as a catalyst for more than $36 billion in follow-on petrochemicals investments and the creation of more than 100,000 long-term jobs.
By Heather Doyle