Shell Chemical LP exercised its option to acquire land in Monaca, Pa., which could be used to build a $4 billion world-scale ethane cracker in the heart of the Marcellus Shale, from Horsehead Holding Corp. The site currently houses a former zinc plant that would need to be torn down. Details on the purchase, including closing date and purchase price, were not disclosed.
Company officials were quick to point out that this acquisition is not an indication that Shell will construct the cracker, but is instead another step in the decision-making process. The company needs to own the land in order to continue along with permitting applications and other studies.
"This is not a final decision," Shell spokeswoman Kimberly Windon said in a statement. "This step means that we have determined the site is suitable if we decide to build the proposed cracker." The company will make a final investment decision once necessary permits are obtained.
Should Shell proceed with construction, the facility would have a capacity of 1.5 million tons per year of ethylene and include three polyethylene units when it would come online in 2019.
While Shell’s proposed cracker has garnered most of the attention, it is not the only proposal in the region. Last month at Penn State’s Gas Utilization Conference in Canonsburg, Pa., David Peebles, vice president of the Odebrecht Group, said that his company’s proposed Ascent Project in Parkersburg, W.Va. was not in direct competition with the Shell cracker project as there is enough gas in the region to support multiple projects.
Jim Cutler, CEO of Appalachian Resins, echoed similar sentiment when he told Midstream Business in September that his company was moving its proposed 600 million pounds per year cracker from Madison County, W.Va., to Monroe County, Ohio.
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