European petrochemical manufacturer, Ineos Olefins & Polymers just took possession of the first of eight Large Gas Carriers (LGC). LGCs are large ocean going vessels that are specially outfitted to haul not only ethane, but other hydrocarbon gas liquids and liquefied natural gas. Each ship is the length of two football fields.
Ineos Olefins & Polymers has entered into a 15 year contract with Evergas to export Marcellus and Utica ethane from the Mariner East Project 1 and Mariner East Project 2 via the Marcus Hook Industrial Complex to its cracker facilities in Scotland and Norway.
Ineos Europe was the first European company to contract for ethane feedstock from the United States. In 2012, Ineos contracted with a Marcellus-based supplier, Range Resources, for ethane, and with Sunoco Logistics for the associated transportation capacity on the Mariner East project that would move the ethane east from the Appalachian Basin for transatlantic shipment. As an anchor shipper, Range Resources has firm transportation of 40,000 b/d (20,000 b/d ethane, 20,000 b/d propane), and will have storage capability for both ethane and propane at Marcus Hook.
The Marcus Hook Industrial Complex, located along the Delaware River south of Philadelphia, Pennsylvania, was formerly a Sunoco refinery and is now being used as a terminal and dock facility. It is operated by Sunoco Logistics Partners, with additional hydrocarbon gas liquids (HGL) related manufacturing, including a planned propane dehydrogenation plant. The Mariner East 1 and Mariner East 2 pipeline projects are designed to deliver HGL from the Marcellus and Utica shale areas in western Pennsylvania, West Virginia, and eastern Ohio to Marcus Hook. Mariner East 1 began operations in fourth-quarter 2014, delivering propane to Marcus Hook, and is scheduled to be fully operational for delivering up to 70,000 b/d of propane and ethane in the second half of 2015. Mariner East 2 is expected to begin operations in fourth-quarter 2016 with an initial capacity of 275,000 b/d for both domestic and international customers.
With the first Dragon class vessel entering operation next month, and Ineos upgrading its ethane terminal in Rafnes, Norway, to handle these ships starting in mid-to-late 2015, ethane shipments from Marcus Hook to Europe are expected to start during the second half of 2015.
* Article provided by the U.S. Energy Information Administration