Officials look to needs of cracker plant
PARKERSBURG – With the announcements made and some details being released on the proposed ethane cracker plant slated for development in Washington Bottom, work will soon begin on the needed infrastructure to accommodate such a industrial complex.
Wood County was recently chosen as the site for a possible new petrochemical complex – the ethane cracker plant – to be built by the Brazilian-based company Odebrecht on the site of the SABIC plant in Washington, W.Va.
West Virginia Commerce Secretary Keith Burdette was the keynote speaker at the Area Roundtable’s recent annual meeting where he and company officials from Odebrecht discussed some of the aspects of the proposed project.
Burdette said tax incentives which were put in place by the state Legislature a couple years ago in the hopes of enticing Shell to locate such a facility in West Virginia are still in place. Although Shell eventually chose a site in Pennsylvania, the incentives are still in place for Odebrecht.
“The incentives that were worked out will all be a part of the end equations,” Burdette said. “They know the incentives are already all in place.
“We have have gone through all of the existing tax credits, income tax credits and all of the existing property tax credits. They know what is in place.”
According to Burdette, the challenge is overcoming infrastructure issues and how the state can assist the company. Officials talked about the need for pipelines to be able to move the natural gas and its related products around.
“If they were building in the Gulf Coast, the pipelines and supplies would all be there,” Burdette said. “We have to figure out a combination that assists them to offset some of those costs.
“We are not sure how that gets done, but we think that is the next big challenge to overcome.”
The proposed complex, which will also include three polyethylene plants and associated infrastructure for water treatment and energy co-generation, is called Ascent, which stands for “Appalachian Shale Cracker Enterprise.” A cracker plant converts ethane, a byproduct from Marcellus Shale and Utica Shale natural gas, into the widely used ethylene, a key component for the plastics industry.
If the plant is built, it would be operated by Braskem America. The company, which is based in Philadelphia, also operates a research center in Pittsburgh.
Natural gas is to the chemical industry as flour is to a bakery, Cal Dooley, President/CEO of the American Chemistry Council, said in a video clip played for the Area Roundtable.
“For the first time in 50 years, major chemical producers are looking at making multi-billion dollar investments in West Virginia to capitalize on the Marcellus Shale,” he said. “Around 96 percent of all consumer products have chemicals as a part of them.
“A significant number of those are derived from natural gas that has been cracked into various chemicals.”
Development of ethane cracker facilities are expected to create a renaissance in manufacturing in the United States, Dooley said. This could represent $7 billion to the West Virginia economy and the creation of 10,000-12,000 jobs.
Officials want to build a cluster of facilities in this part of the country to facilitate development of natural gas pulled from the Marcellus and Utica Shale deposits that would require states – like Ohio, West Virginia and Pennsylvania – to work together to develop a number of related businesses and opportunities to benefit the region as a whole.
David Peebles, a business development manager for Odebrecht, said the Marcellus and Utica Shales are some of the largest deposits of natural gas in the United States.
“You have the Marcellus and Utica Shale,” he said. “We have to figure out ways to build infrastructure and the pipelines that will facilitate the export of that material to the Gulf (of Mexico).
“It is like having a big highway and feeder roads. We have to create feeder roads that allow us to have business develop here.”
There is a worry that the gas will just be pulled out of the ground and sent elsewhere to be processed, like what has happened with coal.
“It is not a matter of shutting any export out,” Peebles said. “There is enough supply here with the Marcellus and Utica to not only export but also build here.
“We have to make sure we build here and not just export. That is why it is important to look at both the Utica (primarily under Ohio) and Marcellus (primarily under West Virginia and Pennsylvania). We look at Ohio, Pennsylvania and West Virginia as a cluster of opportunity.”
Burdette said it will take time for many aspects of the project to come together.
“This is not a short process,” he said. “The state is fully committed to bringing this project to fruition.
“We know we have an equally committed partner in Odebrecht. If there is a way to make it happen, it will happen here in Wood County, West Virginia.”
Burdette said it has been a very complicated process in addressing the needs of the project.
“It has been a meticulous challenge to identify the challenges and overcome them,” Burdette said. “The last missing piece of the puzzle is how we work on the lack of infrastructure that will be needed.
“We are going to work on that. That is what we are going to be working on and focusing our attention on over the next several months.”