OSU professor an ‘optimist’ on ethane cracker
DILLES BOTTOM, Ohio – An Ohio State University professor believes the construction of the $5.7 billion ethane cracker in Belmont County would help fill hotels in East Liverpool, Marietta and Zanesville.
The facility could process material drawn from a 600-mile radius upon operation, they said.
Thailand-based PTT Global Chemical is spending $100 million for the engineering and design of the complex that would fill about 500 acres along the Ohio River and Ohio 7 to the south of the Moundsville Bridge. Meanwhile, FirstEnergy Inc. is demolishing the former R.E. Burger power plant, utility spokesman Jennifer Young said.
The First-Energy property is a significant portion of the land needed for the ethane cracker. Ohio-West Virginia Excavating has a tentative agreement to sell its property to PTT.
Matt Englehart, a spokesman for JobsOhio, the state’s private economic development agency helping broker the deal, said PTT should make a final investment decision by early 2017 at the latest.
Edward Hill, a professor of public affairs at Ohio State, tracks development of Ohio’s oil and natural gas industry and its impact in surrounding states.
A project of such magnitude would require thousands of construction workers, he said.
“I suspect that the work force will be drawn from a much wider area – within an hour’s travel time. This means that existing hotels rooms and apartments from Weirton and East Liverpool to Zanesville can be used,” Hill said.
The ATEX Express ethane pipeline, as well as the Sunoco Logistics Mariner East and Mariner West pipelines, ship Marcellus and Utica shale ethane to crackers along the Gulf Coast or in Canada – or even ship it to the Marcus Hook Industrial Complex near Philadelphia for export to Europe.
In Wood County, Odebrecht, a company from Brazil, is studying a multi-billion-dollar ethane cracker at the former SABIC chemicals in Washington Bottom. While a final decision has not been made, officials in Wood, Washington and surrounding counties are anticipating development related to the plant of an unparalleled level.
Royal Dutch Shell also is studying a potential ethane cracker near Monaca, Pa. Industry leaders believe there is enough ethane in the region to justify more than one project.
The region would be much better off with at least one ethane cracker, such as PTT Global, he said.
“The recent research indicates that the transportation cost savings are important. It is not only the cost saved in not shipping the natural gas liquids to the Gulf of Mexico, but also the transportation cost saved in not having to ship the final product to the industrial Midwest, where it is used,” he said. “There is strong regional demand within a 600-mile radius from Belmont County.”
The proposed plant would accept ethane pumped from Marcellus and Utica shale wells, which remains in overabundance because there is still no cracker in the region. The technology would transform this material into ethylene.
Hill said he is optimist for the for the future of the Belmont plant because of the $100 million commitment.
“Also a year is a long time in the energy markets, especially when the price of oil is close to the cost of getting it out of the ground in the Arabian Gulf. I suspect that PTT will take the year to complete its due diligence on the site and to get a clearer perspective as to where the gas and oil markets will be in terms of their equilibrium prices,” Hill said.