June 13, 2020 Read More →

Coronavirus risks aren’t only potential dangers for Shell Pennsylvania plastics complex

BIC Magazine:

Shell interrupted on March 18 the construction of this complex where it has a 100% interest and begun a restart in stages on May 4. Once built, it will crack ethane from Northeast shale basins into ethylene to polymerize into 1.6 million tonnes of polyethylene annually, as reported by Petrochemical Update.

As of early June 2020 Shell has controlled with safety protocols the incremental construction restart of its new planned ethylene and polyethylene complex in Pennsylvania yet other risks brewing before Covid-19 may eventually prove harder to mitigate.

Construction started in 2017. Along with a similar project still under consideration in Ohio, it leads expectations of increased petrochemical activity in the Northeast that could diversify production from the U.S. Gulf Coast hub.

While the company keeps the pandemic under control around the site, other risks around the project may become more challenging.

“This complex will not be as profitable as originally presented,” said Tom Sanzillo, director of finance at the Institute for Energy Economics and Financial Analysis (IEEFA).

The IEEFA promotes diverse and sustainable energy and gets support from the Rockefeller Family Fund and the Mertz-Gilmore Foundation among other organizations.

“The price of plastics in 2012-2016 was in the $1 per pound range. Today, plastics prices are in the 40 to 60 cents per pound range,” he added, according to a statement by the IEEFA to announce a report citing concerns for risky conditions that predate Covid-19.

“Shell is entering the plastics petrochemical market in resin pellet production, an area where it has no market share,” Sanzillo added. 

[Renzo Pipoli]

More: PU: Shell controls Covid-19 after restarting Pennsylvania construction but other risks loom

Posted in: IEEFA In the News

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