Shell's Pennsylvania Ethylene Unit Gears Up for Startup

Researched by Industrial Info Resources (Sugar Land, Texas)--Shell plc (NYSE:SHEL) (London, England) is gearing up for the gradual startup of its 1.5 million-metric-ton-per year ethylene unit in Monaca, Pennsylvania.

The ethylene unit will feed high-density and linear-low-density polyethylene units at the chemicals complex. Subscribers to Industrial Info's Global Market Intelligence (GMI) Chemical Processing Project Database can click here for a list of related project reports.

"So Pennsylvania, we're done building it," said Shell Chief Executive Officer Ben van Beurden in July during the company's second-quarter earnings conference call with industry analysts.

"Now, there's always a phase when you are completing construction and go into start-up mode," van Beurden said, according to a Motley Fool transcript of the conference call. "We've been trying to do it as gradual as possible. And of course, we have, in a way, been starting up support systems and utilities already for many quarters. But over the summer, we will indeed start bringing production on gradually."

He continued: "It's very important we do that safely and reliably, and therefore we do not put pressures on our teams and say you have to have product done by X date. Everybody understands that today's environment is a good environment to start producing in. But I would imagine that somewhere into the third quarter, we will make a lot of good progress. And I would imagine that somewhere in the fourth quarter, this will be running more or less at design capacity."

By 2023, the facility will contribute fully to the company's earnings results, said van Beurden.

"It should be very welcome, of course, because this is a very advantaged project because of its feedstock cost, but also because of the location, where it is, in the middle of the large plastics demand in northeast North America," he added.

Van Beurden noted that the company's chemicals earnings were "not strong" during the second quarter. "That is because the chemical sector that we are exposed to is actually at still at a lower end, if not the bottom of the cycle...But we are exposed to a different type of product package basically because we are not large in polyolefins, particularly not in North America."

"We will fix that, of course, once we have Pennsylvania on stream," he added.

The plant will consume ethane (a feedstock for ethylene) from the Marcellus Shale.

The Energy Information Administration (EIA) forecasts that U.S. ethane production in 2022 will exceed production in 2021 by 16%, or 340,000 barrels per day (BBL/d). Three new ethane crackers are supporting growth in domestic ethylene production: two in Texas and Shell's Pennsylvania facility, the EIA said.

In Texas, the Exxon Mobil Corporation (NYSE:XOM) (Irving, Texas) and Saudi Basic Industries Corporation (SABIC) (Riyadh, Saudi Arabia) joint venture in San Patricia County started up in January. It has a capacity of 1.8 million metric tons per year. Subscribers can click here for the project report.

Also, the 1 million-ton-per-year Bayport Polymers ethylene unit, located in Port Arthur, Texas, started up in July. The project is a result of the 50:50 Bayport-Polymers (Baystar) joint venture between TotalEnergies SE (NYSE:TTE) (Courbevoie, France) and Novealis Holdings LLC, which itself is a joint venture between NOVA Chemicals (Calgary, Alberta) and Borealis AG (Vienna, Austria). Subscribers can click here for the project report.

Chemical producers in North America enjoy the advantage of low-cost ethane, compared with higher prices for naphtha-based or coal-based products.

Subscribers can click here for a list of all projects mentioned in this article and click here for all related plant profiles.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 Trillion (USD).