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VIDEO: After 10 Years, Shell's Mammoth Ethane Cracker Facility Open in Western Pennsylvania

Mon November 21, 2022 - Northeast Edition #25
Pittsburgh Post-Gazette & StateImpact Pennsylvania

Shell Chemical's Beaver County, Pa., long-awaited petrochemical complex is now operational, the company announced Nov. 15, capping a decade of anticipation.

The sprawling $6 billion plant, known as an ethane cracker, takes ethane, a component of natural gas, from Appalachian shale fracking operations in the region and processes it into 1.6 million metric tons of plastic a year. In fact, it is already transforming liquid ethane into lentil-sized polyethylene pellets from the site along the banks of the Ohio River in Potter Township, according to the Pittsburgh Post-Gazette.

Shell spent the past six years constructing the massive facility, which currently employs approximately 600 workers, the news outlet reported.

Since the company revealed plans for an ethane cracker in the region, the project has enjoyed the support of several governors and was granted more than $1.6 billion in public incentives.

Hilary Mercer, senior vice president of Shell Polymers, said in a company Facebook message, "Shell Polymers' will use our polyethylene to create products that we see and use every day — consumer packaging, pipe, conduit and many more lifestyle solutions.

"Safely constructing and commissioning this world-class facility is a special, once-in-a-lifetime opportunity and we couldn't have done it without a truly collaborative approach between teams around the globe and the support of the community."

At the peak of the facility's construction, there were approximately 8,000 workers on site.

Building the plant was Pennsylvania's largest industrial project since World War II, according to Gov. Tom Wolf's office, and benefitted from the largest state subsidy ever — a $1.65 billion tax credit, plus various state and local tax breaks, reported StateImpact Pennsylvania, a media collaboration covering the state's energy economy.

The Wolf administration marked the occasion of Shell's announcement by recalling that the governor called the petrochemical project a "game changer" 2016, when the petrochemical company made the decision to invest in it.

"And he's absolutely right," Neil Weaver, acting secretary of the state's Department of Community and Economic Development told the Post-Gazette. "This project is really going to bolster the economy in western Pennsylvania."

Full Production Should Happen in About a Year

Typically, when a regulated facility is ready to start up in Pennsylvania, the state's Department of Environmental Protection (DEP) will perform an initial operating permit inspection. But because of the size of Shell's facility and, more precisely, the number of emission sources there, the DEP began these inspection activities in phases several months ago.

The Post-Gazette noted Shell had always said that going into commercial operations would not be the kind of event obvious to the naked eye. Its large metal towers have been exhaling steam for months, while its flares have lit the sky on and off for as long. The wastewater plant and a 250-megawatt natural gas power plant onsite have been operating since 2021.

"The systems and infrastructure are already producing product," Shell spokesperson Curtis Thomas said in response to questions from the Steel City newspaper. "Along the way, we're checking and double-checking system integrity, tweaking and making steady progress toward full production."

The full production goal of 3.5 billion pounds of polyethylene pellets a year should be reached in the second half of 2023, according to the company. The complex will ship its products to customers that will then turn those pellets into specialty films, pipe, blow-molded containers, and injection-molded parts.

Stefani Pashman, CEO of the Allegheny Conference on Community Development, told the Post-Gazette the ethane cracker project "demonstrates the power of placing big bets that position the Pittsburgh region for the future."

"From the world-class facility that is operational today to a commitment to ensuring the region secures a leadership position in decarbonization via carbon capture and clean hydrogen, Shell is a valuable partner in the economic future and quality of life for our 10-county region," she added.

Environmentalists Skeptical of Shell's Claims

The Shell ethane cracker plant is becoming operational at a time of heightened concern about greenhouse gas emissions.

According to StateImpact Pennsylvania, environmental groups worry about the facility's potential for pollution. State-issued permits allowed it to be Pennsylvania's second biggest emitter of volatile organic compounds, precursors to smog, as well as the state's permission to release a large source of greenhouse gas pollution, with the climate impact of 400,000 more cars on the road.

As part of a settlement with environmental groups, though, Shell agreed to install and use fence line monitors at the plant to check emissions.

The energy company, which built its plant on 384 acres of the 700 acres it secured for the project, has said there is room on its campus and nearby land to capture the carbon dioxide emitted at the plant and at other facilities across the region, to pump it underground for long-term storage. The company has partnered with Equinor, a Norwegian energy firm, in pursuing a carbon capture, storage, and hydrogen hub at the new plant.

The two companies submitted their intentions to the U.S. Department of Energy earlier in November and the state approved the concept as Pennsylvania's entry into the competition for $8 billion in federal funding for such hubs.

Incentives Helped Build Ethane Cracker

The road to building the plant began in 2012, with the passage of the project's tax credits, as part of the state's Resource Manufacturing Tax Credit program.

"I can tell you, with hand to my heart, that without these incentives, we would not have made this investment decision," a Shell executive said in 2016.

Gov. Tom Corbett, who championed the tax credit for Shell, said at the time, "When you're looking at the investment, you have to look at what it would have cost us had we done nothing, had we let these businesses go."

The earlier tax credits were thought to be kick-starting a regional plastics manufacturing boom. So far, that has not materialized, reported StateImpact Pennsylvania, as the Shell plant is the only one of its kind in the region. A Thai company that has been considering building an ethane cracker in Belmont County, Ohio has yet to green-light that project.

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