Engineering News

Shell Chemical Extends Option on Site for Proposed Pa. Cracker
July 01, 2013

Shell Chemical LP and Horsehead Corp. have amended an option and purchase agreement that gives Shell an extra 6 months to evaluate a site in Monaca, Pa., where it has proposed building a world-scale ethylene cracker, according to a statement issued Friday by Horsehead Holding Co.

The action extends a land option agreement that Shell Chemical and Horsehead originally signed March 15, 2012. Currently housing a zinc smelter owned by Horsehead, the site is approximately 30 miles northwest of Pittsburgh. Shell initially proposed building a petrochemical complex in the Appalachian region in mid-2011 to process ethane produced from the Marcellus Shale formation into ethylene, a key petrochemical building block. After considering several locations in the region, Shell selected the Beaver County, Pa., site and signed the formal land option agreement with Horsehead. The deal for the preferred site cleared the way for Shell to perform additional economic, environmental and engineering studies for the proposed project.

One of the project's key local supporters, the Pittsburgh Regional Alliance (PRA), described the 6-month extension of Shell's site review as a "routine aspect of this kind of ongoing evaluation."

The extension "doesn't change anything about the continuing evaluation," said PRA President Dewitt Peart in a press release issued shortly after the amendment was announced. "It just reaffirms that both parties remain interested in a future transaction that would transfer ownership of the site to Shell."

The area economy would realize substantial benefits if Shell decides to build the ethane cracker, according to a 2012 study conducted by the Pennsylvania Economy League of Greater Pittsburgh (PELGP). The PELGP study concludes the project would add $2.8 billion to the economy and likely generate 10,000 direct and 8,000 additional jobs in a 10-county region during the peak of construction. During operations, the facility reportedly would inject $4.8 billion annually and support 400 direct jobs and between 2,000 and 8,000 total jobs.

"The PRA is – and remains – optimistic that the site near Monaca, Pa., will become the home of a state-of-the-art, world-class Shell Chemicals petrochemical facility at the conclusion of the evaluation process," concluded Peart.

Source: Downstream Today Staff

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