Will Marcellus Shale Save Philly Marcus Hook Refinery?

Last year the Philadelphia region was hard-hit when both Sunoco and ConocoPhillips announced they would shut down a combined three refineries in the area. Since then, ConocoPhillips sold its refinery for $180 million to Delta Air Lines which will convert and use the plant for jet-fuel production. Sunoco is in talks to sell its one of two refineries (in Philly) to a joint venture headed by the Carlyle Group—but if that doesn’t develop, they’re going to shut it down.

And then there’s the Marcus Hook refinery, which closed it doors “for good” in April. Officials from the town of Marcus Hook and Delaware County are working hard to get it reopened. As part of that process, they commissioned a $100,000 study, just released, from IHS Consulting. The study identifies seven possible uses for the idled refinery, and pegs its best chances of reopening based on the abundance of natural gas and gas liquids coming from the Marcellus and Utica Shale region.

One of the possible uses which IHS says stands a “high” probability of success is converting the facility into an ethane cracker plant. But with one ethane cracker on the way in PA, on the opposite side of the state (and much closer to where the gas liquids are located), MDN is not sure how likely that scenario would be for Marcus Hook. Still, a second ethane cracker is an intriguing possibility.

Would Sunoco be willing to reopen the plant? The local officials who commissioned the study say they (fervently) hope Sunoco will give a second look at reopening the Marcus Hook refinery. In essence, they took a leap of faith by spending $100,000 on this study in order to show Sunoco (or someone else, if it comes that) how they can leverage the facility. Reopening the plant would mean approximately 500 jobs coming back to the community that were lost when the plant closed.

Unfortunately MDN could not locate a copy of the 127-page study to share with you. However, embedded below is the IHS press release about the study, including a handy table of the uses they’ve found for the refinery.

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