UPDATE: 06/06/11, 3:27 p.m.
Shell Oil Co. plans to build an ethylene plant, known as a "cracker," in the Appalachian region of the United States as part of its long-term plan to monetize natural gas, the company said June 6.
The cracker would process ethane from natural gas in the Marcellus field, which spans the Appalachian Basin, to produce ethylene, a primary petrochemicals feedstock.
The ethylene produced will likely be used in the production of polyethylene, a raw material used in various manufactured goods including packaging and adhesives.
Most of the polyethylene produced would be sold to manufacturers in the Northeast United States. Polyethylene demand in North America is expected to grow, the company said.
Shell said it plans to take advantage of abundant and affordable natural gas resources in the United States by extracting ethane and other natural gas liquids for petrochemicals production.
The company's plans also include developing shipping solutions for liquefied natural gas; utilizing gas-to-liquids technology to produce fuels, lubricants and chemicals; and gas-for-transport in markets focusing on heavy-duty vehicles, marine and rail transportation.
“This fits well with our strategy to strengthen our chemicals feedstock advantage and would be another step in growing our chemicals business to meet the increasing demand for petrochemicals,” said Ben van Beurden, Shell executive vice president for chemicals.
Shell is among a growing number of petrochemical producers tapping into increasing shale gas resources in North America.
Dow Chemical Co. announced a plan on April 21 to build a new ethylene production plant in the Gulf Coast to take advantage of shale gas supplies in the Eagle Ford and Marcellus shale regions.
In addition, Bayer Corp. has said it's in discussions with chemicals companies that may be interested in building an ethane cracker at its industrial park in the Marcellus gas field.
Petrochemical expansion plans in the Marcellus region indicate the area contains a sufficient amount of ethane for more significant investments, says Kathryn Klaber, president and executive director of the Marcellus Shale Coalition, which represents gas-drilling companies in the region.
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