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Shell Pennsylvania cracker on track, Enterprise alters Americas expansion plans, Motiva plans petchem projects
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Shell Pennsylvania Cracker on track
Shell Chemical has installed most of the major components of its new plant in Beaver County, Pennsylvania. Roughly 5,000 workers are on site building the plant now, and up to 6,000 are expected to be on site by year end. Work is expected to take another 18 months to complete, an executive told the local television station WKBN 27.
The Shell cracker is the first major U.S. major petrochemical complex outside of the U.S. Gulf in more than 30 years.
The plant sits on more than 300 acres bounded by I-376 and the Ohio River, where barge traffic can be seen bringing equipment for the plant that was too large to get there any other way.
The plant’s supply chain has access to highway, rail lines and the river.
The plant also sits near the center of the Marcellus Shale natural gas play for its upstream resources, as well as a big chunk of Shell’s potential customer base.
“Within a 700-mile radius are 70% of the North American polyethylene manufacturers, so they’re the people who will buy our products from us,” Michael Marr told WKBN.
The plant will eventually hire about 600 operators, engineers and safety and environmental workers.
Beyond the plant, there will be spin-off jobs. The plant will ship off upward of 100 rail cars of polyethylene pellets each day and many believe that is just the beginning.
Enterprise to build PDH2 plant with LyondellBasell
LyondellBasell and Enterprise in late September announced that their respective affiliates have executed long-term contracts that support construction of Enterprise’s second propane dehydrogenation (PDH) plant (PDH 2).
“As we aim to meet the growing demand for our products, ensuring a long-term supply of feedstock is critical,” said Bob Patel, chief executive officer of LyondellBasell. “These agreements allow us to leverage Enterprise’s construction expertise, operating experience and robust network as we continue to deliver an outstanding value proposition for our customers.”
PDH 2 will have the capacity to consume up to 35,000 barrels/day of propane and produce up to 1.65 billion pounds/year of polymer grade propylene (PGP). PDH 2 will be located at Enterprise’s complex in the Mont Belvieu, Texas area. The facility is scheduled to begin service in the first half of 2023.
“General demand growth for these propylene-based products is strong and PDH 2 will provide cost-advantaged supply assurance to our customers, enabling expansion of their downstream businesses to satisfy this global demand,” said A.J. “Jim” Teague, chief executive officer of Enterprise.
Enterprise has licensed Honeywell UOP’s Oleflex propane process to produce PGP. Enterprise has more than 25 years of experience with this technology. The company’s existing isobutane dehydrogenation (iBDH) plant, which uses the Oleflex butane process, began operations in 1993.
The partnership is currently building a second iBDH facility utilizing the same process, which is expected to be completed later this year and is on time and on budget, the company said.
Enterprise has negotiated terms for a fixed-cost Engineering, Procurement and Construction contract with S&B Engineers and Constructors, Ltd. (S&B) to build PDH 2. Enterprise’s experience with S&B dates to 1995. S&B-led construction projects for Enterprise include nine natural gas liquid (NGL) fractionators and certain deisobutanizers at Mont Belvieu, the Hobbs NGL fractionator, and the partnership’s ethane export facility on the Houston Ship Channel.
Enterprise began its fee-based midstream petrochemical service business with the development of its first propylene fractionator in 1978. PDH 2 is being developed with this same fee-based model. These anchor contracts are service-based under which Enterprise processes LyondellBasell-provided propane to PGP for a fixed fee. This fee-based model leverages Enterprise’s integrated value chain by providing sourcing and storage from Enterprise’s NGL storage facilities in Mont Belvieu and delivers PGP into its open market storage hub and growing network of PGP pipeline infrastructure.
Enterprise’s network of PGP assets includes more than 300 miles of delivery pipelines, 26 PGP connections, more than five million barrels of storage capacity, and an export terminal on the Houston Ship Channel.
Enterprise is currently expanding PGP refrigeration facilities at the terminal, which will enable the company to load more than 5,000 barrels per hour of PGP, as well as co-load PGP and LPG on very large gas carriers.
Enterprise’s Mont Belvieu NGL fractionation and storage system supporting PDH 2 currently has 760,000 barrels/day of NGL fractionation capacity, with another 300,000 barrels/day under construction.
In addition, these complexes have more than 100 million barrels of NGL and petrochemical storage.
“The integration of the PDH 1 and PDH 2 plants with Enterprise’s propylene fractionation facilities provides operational flexibility for both processes, and a combined PGP supply of more than nine billion pounds per year,” the companies said in a statement.
Construction of PDH 2 is expected to provide 1,500 to 2,000 jobs in the greater Mont Belvieu and Baytown area.
LyondellBasell shifts Americas expansion plans
Days before the Enterprise announcement, LyondellBasell said it no longer plans to build a propane dehydrogenation (PDH) project in the U.S.
The comments were given by Bob Batel, CEO of LyondellBasell at the company’s investor day meeting in Houston, Texas at the end of September.
LyondellBasell was previously considering an upstream PDH plant and a downstream polypropylene (PP) project in the U.S.
While it still plans to build the PP project, it will no longer build the upstream PDH unit, Patel said.
LyondellBasell is in the midst of two major capital projects in the U.S.
On the books now are its 500,000 tonne/year high density polyethylene (HDPE) project in La Porte, Texas, slated for start-up by the end of 2019, also a propylene oxide (PO)/tertiary butyl alcohol (TBA) project with 470,000 tonnes/year of PO and 1.1 million tonnes/year of TBA in Houston by the second half of 2021.
Looking out further, in 2024 and beyond in the U.S., LyondellBasell plans to build a 500,000 tonne/year PP project, another 500,000 tonne/year PE plant, and complete a debottlenecking of its Channelview, Texas cracker to expand ethylene capacity by 250,000 tonnes/year, the company said at investor day.
Motiva planning Texas petchem complex
Saudi Aramco’s Motiva has expressed plans for further chemical developments at Port Arthur, Texas, including building a world-scale steam cracker, polyethylene units, and an aromatics facility, according to documents filed with the state comptroller.
Motiva filed documents with the state comptroller to build a $4.7 billion steam cracker and a $1.9 billion aromatics complex on the site of its Port Arthur refinery in Texas. The company is also refurbishing two buildings to be used as offices in downtown Port Arthur, Texas.
The refiner has not yet made a final investment decision (FID) on the petrochemical complex in Texas, but ICIS reports one is expected in 2020.
Construction on all three of the Port Arthur plants Motiva is proposing would begin late next year and be finished by late 2024, the documents show.
Motiva plans to finance the proposed petrochemical expansions in part through profits from sales of lower-sulfur marine fuel that will be mandated for shippers by the IMO 2020 regulations.
On January 1, 2020, the International Maritime Organization (IMO) will implement a new regulation for a 0.50% global sulfur cap for marine fuels. Under the new global cap, ships will have to use marine fuels with a sulfur content of no more than 0.50%S against the current limit of 3.50%S to reduce the amount of sulfur oxide.
Saudi Aramco has often stated its intention to grow its petrochemical operations, both in Texas and elsewhere.
In April 2018, the company signed a memorandum of understanding with Honeywell UOP and Technip FMC to evaluate technologies for a chemical complex at the Port Arthur refinery.