Low-cost shale gas is substantially boosting North American chemical manufacturing and enticing foreign firms to make significant investments here, as noted in our January cover story “State of the Chemical Industry: Momentum Builds.” However, the geographic impact of that shale gas is widening.
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In late March, ethane from U.S. shale gas arrived at the Rafnes, Norway, complex of Ineos Olefins and Polymers Europe. This marks the first time ethane has been exported from the U.S. as well as imported into Europe, notes Rolle, Switzerland-based Ineos, which also operates the ship that delivered the ethane. The Rafnes site will use the ethane as fuel and feedstock for its gas cracker.
Shipments from the U.S. to Ineos’ plant in Grangemouth, Scotland, should begin later this year, says the company; the ethane also will serve as fuel and feedstock for the gas cracker there, it notes. The Grangemouth plant is Ineos’ largest production site worldwide as well as the largest manufacturing complex in Scotland.
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The Ineos Intrepid, a massive, 180.3-m (nearly-600-ft) long ship, delivered the gas to Rafnes. It is one of a current fleet of four “Dragon class” ships; each boasts the world’s largest capacity for ethane (27,500 m3 or almost 1 million ft3). The company eventually intends to use eight such ships it has under long-term charter as a virtual pipeline to supply ethane to its Rafnes and Grangemouth sites to supplement and then replace reducing gas feed from the North Sea.
“This is a strategically important day for Ineos and Europe. We know that shale gas economics revitalized U.S. manufacturing and for the first time ever Europe can access this essential energy and raw material source, too,” notes Jim Ratcliffe, chairman and founder of Ineos. (For details on the impact of shale gas on the U.S. chemical industry, see: “State of the Chemical Industry: Momentum Builds.”)
“We are nearing the end of a hugely ambitious project that has taken us five years and cost $2 billion, as we begin supply of ethane from shale to our sites in Europe,” he adds.
The project also included construction of the two largest ethane storage tanks in Europe, a 60,000-m3 (more-than-2.1-million-ft3) vessel at Grangemouth and an about-34,500-m3 (over-1.2-million-ft3) one at Rafnes.
The Grangemouth complex contains Scotland’s only refinery, an about-10-million-mt/y unit (a joint venture of Ineos and PetroChina International), as well as plants that make about 1 million mt/y of petrochemicals and polymers, including ethylene, propylene, polyethylene and polypropylene.
The Rafnes site contains an about-570,000-mt/y refinery and a low-density polyethylene plant.
The shale gas comes from the Marcellus formation in Western Pennsylvania; it travels through the Mariner East Pipeline, which was constructed by Sunoco, to a deep-water terminal in Marcus Hook, Pa., on the site of a now-shuttered Sunoco refinery. The gas is cooled to -90°C (-130°F) during its 3,800-mile, nine-to-ten-day trip to Europe.
Ineos’ pioneering efforts to land North American gas probably won’t trigger a rush by other companies looking for resources for their European plants — because the necessary outlays are vast. However, it does underscore that North American plants shouldn’t become complacent about their current feedstock advantage.
