Latest Amount Shell Paid for Ethane Pipeline Easements Goes Down
Bit by bit, piece by piece, Shell is getting landowners in Beaver County, PA to sign easements for its 94-mile Falcon Ethane Pipeline–a pipeline with two “legs” that will feed Shell’s mighty ethane cracker plant. MDN exclusively broke the news in February 2016 that Shell had begun to sign leases with landowners for the pipeline (see Exclusive: Shell Leasing Land for 2 Pipelines to PA Cracker Plant). More easements signed in January, and again in May. However, it was not until last month, June, that we learned what money Shell is paying out for those easements. The numbers for leasing 3,138 feet of space for the pipeline in Greene Township worked out to be roughly $75 per foot (see New Easement for Shell Ethane Cracker Pipeline Reveals Price Paid). Which is far higher than any other rate we’ve seen for pipeline easements–ever. We now have another recorded easement from Shell for the ethane pipeline in Beaver County. This one is a bit more modest: $43 per foot. That’s still a lot more than the typical pipeline easement, but quite a bit less than the previous deal. Bear in mind this is only the second time we’ve spotted actual numbers, so we have no way of knowing what the average price is that Shell has been paying…
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Although a final investment decision (FID) is still months away, Thailand-based PTT Global Chemical decided spending $13.8 million to buy 168 acres at the proposed site for a second Appalachia ethane cracker, in Belmont County, OH, would be a good investment. Which they have now done. The deal, which closed in June, is just now coming to light. PTT bought the land for the site from FirstEnergy Corporation. The deal was recorded at the Belmont County Courthouse on June 14. This is yet another sign that PTT will make a positive FID later this year. Even though PTT just bought the land, work was previously done on the site to clear it and get it ready for construction, as we reported in December (see 
In March of this year, the Team Pennsylvania Foundation released a report called “Prospects to Enhance Pennsylvania’s Opportunities in Petrochemical Manufacturing” (see 
In reading a fascinating story about European chemical plant giant Ineos, the article took an unexpected turn when it said Ineos, indeed all of Europe’s petrochemical industry, is “vulnerable as never before because of the shale oil and gas boom in the US, which has made energy costs there just a fraction of those in Europe.” The article specifically names and credits the Marcellus with producing feedstock that is far cheaper than can be found in Europe–and chemical plants are now choosing to relocate and manufacture their products in the U.S. rather than Europe. The inescapable conclusion: if the United Kingdom (and Europe) refuses to frack, they’re hosed. Ineos, which has figured this out, has “quietly” purchased “some interesting onshore fracking licences” in the UK, and they intend to use them…
Believe it or not, Shell previously hired a third-party consultant to perform a traffic study in the area where Shell plans to build a $6 billion ethane cracker in Beaver County, PA. Based on the findings and recommendations of that study, Shell has begun to secure parking spots for construction workers that will descend on that location to build the plant–beginning later this year. One of the recommendations is to limit the number of parking spots to no more than 1,500 at any one location. Shell currently has three locations lined up and (mostly) ready to go, enough for 3,100 parking spots. At its peak, the project will employ something like 6,000 workers. So either Shell will line up more spots, or maybe workers will carpool…
An economic report released yesterday by the American Chemistry Council (ACC) shows that the Appalachian region could become a second center of U.S. petrochemical and plastic resin manufacturing, similar to the Gulf Coast. ACC President and CEO Cal Dooley presented the findings at a Capitol Hill press event with lawmakers including Senator Shelley Moore Capito (R-W.Va.), Senator Joe Manchin (D-W.Va.) and Rep. David McKinley (R-W.Va.). “The Appalachian region has distinct benefits that could make it a major petrochemical and plastic resin-producing zone,” Dooley said. “Proximity to a world-class supply of raw materials from the Marcellus/Utica and Rogersville shale formations and to the manufacturing markets of the Midwest and East Coast has already led several companies to announce investment projects, and there is potential for a great deal more.” What will it take to turn our region into another Gulf Coast petchem powerhouse? According to the report, an NGL (natural gas liquids, i.e. ethane) storage hub. You may recall Sens. Capito and Manchin recently introduced a bill to study an Appalachian NGL storage hub (see 
As we have endlessly covered, Shell is in the midst of building a $6 billion ethane cracker plant in Beaver County, PA (see 
Whenever a big, important project like the Shell ethane cracker, reported to be a $6 billion investment, goes forward, a whole lotta people were involved before the decision was made. However, if there is one universal truth in business it is this: There is always a champion at the center of any important project. The one person who’s responsibility it is to propel that project forward. The person who, we like to say, has their “butt in a sling.” It is on their shoulders to ensure the projects success. When you dig down into the story of the multi-billion dollar Shell cracker plant now being built in Beaver County, PA, you will find that one person. His name is Brent Vernon. He worked for more than five years to lure Shell to the Keystone State. Vernon was senior project manager for energy for the state when he began working, full time, on the Shell project in 2011. Since then he was promoted, first to deputy director and eventually director of the Governor’s Action Team, a role he continues. Vernon is key–one of the linchpins without whom the Shell deal would not have happened…
Positive economic signs continue to pop up with respect to Shell’s multi-billion dollar ethane cracker project in Beaver County, PA. Here’s the latest major economic impact from the project. A local developer has filed for a state grant to build a massive new housing project 2.5 miles from the cracker site. The new project calls for 450 housing units, retail space, a golf course, swimming pool and parking garage. What’s that? What happens after the cracker is built and the “temporary” workers, who would be living in this new complex for the next 5-10 years, leave? Great question! Answer: Turn it into a retirement community…