More MarkWest Construction Under Way in Doddridge County, WV

MarkWest Energy – Sherwood Complex

MarkWest Energy’s Sherwood Complex in Doddridge County, WV has been in operation since 2012. Since that time, MarkWest has built and currently operates nine processing plants at the complex, capable of separating methane from NGLs. The plant continues to grow. MarkWest is currently building another two processing plants at the Sherwood Complex, to be done and in operation this year. And if that isn’t enough, MarkWest says there is potential to build another six (!) processing plants at Sherwood. As we previously noted, Sherwood is right now the fourth largest gas processing plant in the U.S., and by the end of this year, it will be number one (see MarkWest Building 6 New Processing Plants, 3 Fractionators in 2018). One of the primary reasons for the rapid expansion at Sherwood is Antero Resources, which uses the Sherwood operation to service its vast WV drilling program. Needless to say, the ever-expanding Sherwood facility is a huge blessing, economically, to Doddridge County. Here’s a deep dive into future plans for Sherwood, and how the plant benefits the local community…
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Shell’s PA Ethane Cracker Plant Gets a Name: Shell Polymers

If you’ve read MDN for any length of time, you know about a $6 billion ethane cracker plant being built by Shell in Monaca (Beaver County), PA–near Pittsburgh. The plant will chemically “crack” ethane, an abundant natural gas liquid (NGL) that comes out of the ground along with methane, creating polyethylene from the ethane. Polyethylene is, in essence, raw plastic. Manufacturers in the region and beyond will use the plastic pellets Shell will produce at the plant to create an unlimited variety products. Shell is a smart company. They’re as much a marketing company as they are an oil and gas producer and petrochemical manufacturer. They know the value of positioning and mind share. We hadn’t thought about it previously, but we always just thought of and called the project the “Shell cracker plant.” The plant now has a name: Shell Polymers. The name Shell Polymers has been around for a long time but had fallen out of use when Shell largely exited the plastics business. With the new cracker coming online in the next few years, it’s time to revive the Shell Polymers name/brand and apply it to the cracker plant, which is how the project was being pitched at the last week’s NPE2018 (formerly called the National Plastics Exposition) in Orlando, Florida…
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$325M Gas-to-Liquids Plant Coming to Floyd County, KY

Last week RCL Chemical announced it has partnered with Y2X Infrastructure to build a $325 million gas-to-liquids (GTL) plant in Floyd County, Kentucky. GTL plants convert natural gas, a hydrocarbon, into other hydrocarbons, like diesel fuel, gasoline, solvents and waxes. An abundance of cheap natural gas in the Marcellus/Utica is one of the prime motivators for establishing GTL plants in the region. Although we’ve heard plenty of talk about such plants, we’ve only seen a few prototypes get built thus far. The RCL/Y2X story caught our attention because Kentucky hates new gas pipelines, yet wants to build a plant that will use gas coming from pipelines (see KY Court Decision Goes Against Pipelines re Eminent Domain). Perhaps attitudes in the Bluegrass State are changing? According to RCL, necessary infrastructure (pipelines) are already present in Floyd, one of the primary reasons RCL wants to locate in Floyd. The company says it will begin construction by the end of this year and have the GTL plant built and operating by 2020. The original plan, a few years ago, was to build a coal-to-liquids (CTL) plant in neighboring Pike County. That plan was eventually scrapped and this new plan to build a GTL project has taken its place…
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PTT Buys Another 300+ Acres for Belmont County, OH Cracker

In yet another very good sign that the proposed PTT Global Chemical ethane cracker plant in Belmont County, OH is headed for a positive final investment decision (FID), PTT has just purchased another 300+ acres to go along with the previous acreage they purchased as the site for the future cracker/petrochemical project. Last July MDN reported PTT had spent $13.8 million to buy 168 acres at the proposed site for a second Appalachia ethane cracker, in Belmont County, OH (see PTT Global Buys Land for Belmont, OH Ethane Cracker Plant). That site, the former R.E. Burger power plant property (owned by FirstEnergy Corp.), is the primary location for the proposed cracker. However, more land is needed. A deed filed earlier this week shows that PTT has purchased another 300+ acres for $17.5 million from the Ohio-West Virginia Excavating company. Together, both parcels are roughly 500 acres, which is more than enough land for the facility. Until now numbers like $6.5 billion have been thrown around as the total project cost. The number has now gone up–to as much as $10 billion! Here’s the latest good news that it’s looking better and better for a second ethane cracker in Appalachia…
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Still No Deal on Property Next to PTT OH Ethane Cracker Site

Homeowners who live near the location of a possible ethane cracker plant in Belmont County, OH are running out of time to negotiate a deal to sell their properties. Living next door to a cracker plant is not anyone’s idea of paradise. There will be noise, and smells and (yes) some air pollution coming from the plant. Best to sell now before the plant begins construction. However, representatives for PTT Global Chemical which will build the plant (IF it gets built), say they already have all the land they need for the facility (see PTT Global Buys Land for Belmont, OH Ethane Cracker Plant). Not needing the land puts PTT in a good negotiating position. There are 10 homes in the general vicinity of the proposed cracker plant whose owners want to sell. PTT says they’ve offered the homeowners 125% of fair market value for their homes. The lawyer representing the homeowners says the valuations are not accurate. However, it’s far from being a stand-off. There is no malice or vitriol. It sounds to us like both sides think a deal will get done. It just boils down to finalizing numbers. Here’s the latest on real estate for the proposed Belmont cracker plant…
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MarkWest Building 6 New Processing Plants, 3 Fractionators in 2018

Attendees at yesterday’s Utica Midstream conference at Walsh University in North Canton, Ohio got an earful about pipelines and processing plants. Perhaps the biggest news coming from the event (for us, anyway), is that MarkWest Energy, now part of Marathon Petroleum, plans to build another six natural gas processing plants and another three fractionation plants in the Marcellus/Utica THIS YEAR. MarkWest plans to spend a whopping $2 billion in the region this year! That’s in addition to building two new processing plants and three fractionation plants last year. A processing plant accepts raw hydrocarbons coming out of shale wells and separates out the methane from everything else–“cleaning up” the methane so it’s pipeline-ready. Fractionation takes what’s left after the methane is removed and separates those other hydrocarbons into their discrete molecules–ethane, propane, pentane, butane, etc. According to MarkWest, M-U moving butane to new markets will be a major focus this year. We also learn that MarkWest’s Sherwood facility (in WV) is now the fourth largest gas processing plant in the U.S.–and by the end of this year, it will be #1! In addition to MarkWest, there were a number of other top notch speakers at yesterday’s event, including Rick Simmers from the Ohio Dept. of Natural Resources. Rick mentioned in passing there’s a shale well pad in southeast Ohio with a whopping 28 wells on it. Below is a summary of what was said at yesterday’s event…
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More Pipes Needed in M-U; Antis Gear Up to Protest Shell Cracker

Charlie Schliebs

Speaking of yesterday’s Kallanish Energy “Crackers, Storage & Pipelines 2018” event at Southpointe (Pittsburgh), one of the speakers, Rick DeCesar from AECOM, said contrary to what you may read and hear, the Marcellus/Utica region needs MORE midstream and pipeline projects over the next five years. Lately it seems we’ve read countless stories that say if all of the existing projects that have been announced come online, there will be more pipeline capacity than gas to flow through it. In other words, we’ve overbuilt with pipelines. DeCesar disagrees. He maintains new projects are “desperately needed.” His company is putting its money where its mouth is, hiring new people, in anticipation of more pipeline projects. MDN friend Charlie Schliebs was moderator for the panel featuring DeCesar. Charlie also had some interesting, and disturbing, things to say. Namely, he warned attendees that antis are gearing up to fight “and perhaps be arrested” in a bid to block construction work on the Shell ethane cracker plant in Monaca, PA…
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PTT Global Ohio Cracker Grows to $10B Project w/New Partner

With much fanfare, yesterday a press event was held in Columbus, OH to make an official announcement of what we already know: that South Korea’s Daelim Chemical, a subsidiary of Daelim Industrial, is now a partner with PTT Global Chemical in the Belmont County ethane cracker project. We previously brought you that news on Feb. 1 (see PTT’s “Big Announcement” – Gets a New Partner for Belmont Cracker). OH Gov. John Kasich along with officials from PTT and Daelim held a presser yesterday to officially announce the partnership, but also to announce that PTT has pulled the trigger on buying more land for the project–a positive sign. There was also talk by all three that the size of the project has grown. Plans are now that the project will cost $7.5-$10 billion to build, and it will have the same daily capacity as the Shell cracker now under construction in PA–using up to 100,000 barrels of ethane per day to make ethylene (raw plastic). Disappointingly, there was no “final investment decision” (FID) announcement. However, Kasich said he is “very hopeful” all three will be back, soon, to make an FID announcement…
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MarkWest Building New Fractionation Plant in Harrison County, OH

Hopedale Fractionation Facility (click for larger version)

MarkWest Energy, now a subsidiary of Marathon Petroleum (MPLX unit) is THE premier shale gas processor in the Marcellus/Utica region. When natural gas comes out of the ground, a bunch of other hydrocarbons come out of the ground with it–namely NGLs (natural gas liquids). NGLs include compounds like ethane (C2H6), propane (C3H8), butane (C4H10), isobutane (also C4H10), and pentane (C5H12). MarkWest’s cryogenic processing plants separate out the methane from NGLs. A different process, called fractionation, further separates the NGLs into their component parts. MarkWest handles an estimated 60% of all fractionation in the M-U. MarkWest has standalone plants set up to separate out ethane–called C2 fractionation because ethane has two carbon atoms. Ethane fractionation plants are their own separate beast–removing ethane from the NGL stream. Finally, there are C3 fractionation plants, which tackle separating the other NGLs–propane, butane, isobutane and pentane (referred to as C3+ fractionation because each of those compounds has three or more carbon atoms). In the Hopedale fractionation operation (Jewett, Ohio), MarkWest already has three C3+ fractionation plants up and running–Hopedale I, II, and III. Each one processes 60,000 barrels of NGLs a day, for a cumulative 180,000 bbl/d capacity. Honeywell issued a press release yesterday to say they have been tapped to build a fourth Hopedale C3+ fractionation plant, expanding MarkWest’s capacity by another 60,000 bbl/d. Honeywell says it takes just 40 weeks from start to finish and they will have the Hopedale IV plant up and running, by the end of this year…
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MPLX 2017 Results: Income Up Astounding 241%, Adding 6 Plants

MPLX, which used to be known as MarkWest Energy prior to selling itself to Marathon Petroleum, issued its fourth quarter 2017 update yesterday. And wow, what an update! MarkWest…OK, MPLX (old habits die hard)…is the Marcellus/Utica region’s leading gas processing company. MPLX’s facilities process on the order of 60% of all the gas produced in the Marcellus/Utica. The region produced record volumes of gas in 4Q17 (and indeed for all of 2017), which in turn led to record volumes of gas processed (separating the methane from the other hydrocarbons), and record volumes of fractionation (separating the other hydrocarbons into their respective components) for MPLX. Net income soared, both for the fourth quarter and full year. In 4Q17, MPLX’s net income was $238 million, up from $133 million in 4Q16–a 79% increase. For the entire year, MPLX’s net income was $794 million, vs. $233 million in 2016. That a 241% increase year over year! Yeah, the Marcellus/Utica came back big time in 2017. But MPLX isn’t sitting around basking in the glow of success–they have big plans for 2018. In the Marcellus/Utica, MPLX will add six new gas processing plants, increasing the company’s processing capacity by 21% to over 7 billion cubic feet per day. Additionally, MPLX expects to add 40,000 barrels per day of ethane fractionation capacity, and 60,000 barrels per day of propane-plus fractionation. Below is the full update along with the latest PowerPoint presentation…
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NG Advantage Virtual Pipe Hearing in Fenton an Eye-Opener for MDN

Last night MDN editor Jim Willis attended a Zoning Appeals Board hearing in the Town of Fenton (near Binghamton) where board members held a public hearing on a proposed virtual pipeline (i.e. compressor station) application by NG Advantage. It was, for Jim, a real eye-opener–causing him to reassess previous comments he made about the people opposing the project. Let’s begin with a brief background and the purpose of the hearing. NG previously filed an application with the Town of Fenton to build a natural gas compressor station/trucking facility in the very corner of the township, where it borders other towns/communities (bedroom communities). The people in those adjoining communities, when they learned of the plan, were upset that they had not been notified of the plan. In short order lawsuits were filed, and a county judge ruled that the Town of Fenton Planning Board did not take a hard enough look at environmental and traffic issues related to their approval of NG’s plan (see Judge Rules Against Broome Virtual Pipe, NG Advantage to Try Again). That forced NG to reapply for permits to build the facility. The area is zoned light industrial, allowing certain uses. Among the uses in that area are freight/trucking facilities. Not on the list are compressor stations. A Fenton building inspector researched the issue and agreed (with NG) that the facility fits the definition of a freight/trucking facility. That determination was immediately appealed by a number of people and organizations, including the local Chenango Valley School District. The meeting last night was to hear arguments for and against the finding that the facility is a freight/trucking facility and qualifies as an acceptable use in that zone. There were about 200 or so present for the hearing. Passions ran high. We’d say about three-fourths present were against and one-fourth in favor, judging from applause following various speakers. We will outline the evening and the testimony given below, but right up front we want to apologize to those opposing the project. In previous posts we used strong language to describe them, including the phrase “selfish antis” and the word “bullies.” That was wrong and we retract those statements. While we still disagree with those opposing this facility, we listened closely to their arguments and to their hearts. We found the vast majority speaking against the NG facility were not your typical anti-fossil fuel protesters (although there were a few of those there too). Instead, we found they are simply everyday folks who fervently do not want this facility in their neighborhood for a variety of reasons, including (yes) protection of their children. We heard and appreciate their arguments, and we want to acknowledge their position and attempt to fairly and dispassionately state what that position is…
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Although Cove Point LNG Not Yet Operational, Gas Flowing to Plant

Last week MDN brought you news that Dominion’s Cove Point LNG export facility along the shore of Maryland has delayed its official start-up until perhaps as late as April (see Uh-Oh: Cove Point LNG Exports Possibly Delayed Until April). An expert analyst theorized the reason for the delay is to install two flaring systems at the plant (a safety precaution). So if the plant is not yet started up for commercial operations, why is gas still flowing to the facility? Other experts, at BTU Analytics, have been watching pipeline flow data and maintain the Cove Point facility has been receiving a steady flow of Marcellus gas since last September! No doubt some of the gas flowing to Cove Point is used for testing the equipment. But how can gas continuously flow to the plant if it’s not yet being liquefied and shipped out? We suspect some of the gas can be stored. As for the rest? We don’t know. What we do know, based on a post by BTU Analytics, is that even though Cove Point isn’t receiving the volumes it eventually will receive (3.5 billion cubic feet per day once it is fully up and running), Cove Point is getting a smaller, steady flow now–and (the point of this post), that smaller, steady flow is an important new market for Marcellus gas…
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Pittsburgh Presbyterians Call for Stop to Shell Cracker Construction

It’s always a shame–in fact it grieves us–to see once-great Christian denominations succumb to a worldly rather than spiritual purpose and mission. It’s sad to see the modern day version of a golden calf erected in place of God. It’s happened again–this time with the Presbyterian denomination in Pittsburgh. An “umbrella group for 140 Presbyterian churches” in Allegheny County are calling on Shell to stop construction of their $6 billion ethane cracker plant project about 25 miles from Pittsburgh. That’s right–just stop now, throwing thousands of people out of work (not very Christ-like) and throwing away the $1 billion+ Shell has already spent on the fully vetted, fully permitted, fully discussed (for years) project. Why do the Presbyterians want work on the cracker plant stopped? Because the plant will produce “plastic products that have been linked to the death of animals and the diminishment of fragile natural habitats.” Yep. The Presbyterians are now anti-plastic. The very keyboard they typed up their tripe on is, of course, plastic. As was the computer and monitor they used, the chair they sat in, the clothes on their bodies and sneakers on their feet–all come from the plastics the Shell cracker plant will produce. Just for icing on the global warming cake, the Presbyterians are also demanding their denomination divest any of their considerable investments from companies remotely related to the fossil fuel industry. It seems that the golden calf of global warming has now replaced God in the Pittsburgh Presbyterian denomination. And yes, we do grieve over that…
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PTT Global Chemical Officially Delays Cracker Decision Until 2018

PTT Global Chemical, based in Thailand, continues to delay a final investment decision (FID) regarding their much-ballyhooed ethane cracker project in Belmont County, OH. In April 2015, PTT announced they are interested in building a ~$5 billion ethane cracker plant complex in Belmont County, OH (see It’s Official: Belmont County Chosen as POSSIBLE Cracker Plant Site). In May 2016, a story in the Bangkok Post said the final investment decision (FID) will definitely come in 2017. In December 2016, Belmont County officials said the FID would come by the end of March this year (see OH Cracker Final Decision Coming Soon, Site Now Cleared & Ready). But in February, PTT said the FID won’t come until “late 2017,” which is “several months later than we originally announced” (see PTT Global Delays Final Investment Decision for OH Ethane Cracker). Two weeks ago a PTT representative said the company will make some sort of an announcement “by the end of the year” (see PTT Global Final Decision re Belmont Cracker Plant Late Again). We now have the announcement: “PTTGC America will have a significant update that will demonstrate momentum for this project early in 2018. We thank all Ohio and Belmont County partners for their support, and we wish you a happy holiday season.” So the big announcement is that there will be another big announcement in “early 2018.” Yeah, we’re becoming irritated at being teased that the decision is just around the corner…
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Dominion Signals Delay in Cove Point Start-up; Contract Related?

For months Dominion’s top brass has signaled that the country’s newest LNG export facility, Cove Point (situated along the coast of Maryland), would begin full commercial operations “by the end of this year” (see Dominion 3Q17: Cove Point LNG Coming Online, ACP Permits in Dec). That has now changed to “early next year”–which is a disappointment. Earlier this month Dominion began the commissioning process, where they use already-chilled LNG (from a tanker) to cool down the equipment, prior to running regular natural gas through it for the first time (see Dominion Cove Point LNG Export – Dress Rehearsal Begins). It appears the commissioning process to check out all of the equipment and to make triple sure everything is OK is taking longer than Dominion expected. The delay, along with a Reuters story, has given rise to rumors that Dominion’s signed-on-the-dotted-line customer from India is getting cold feet and attempting to renegotiate their long-term, 20-year contract. Dominion says, in so many words, that’s hogwash. Dominion says the slight delay in beginning full commercial operations has nothing to do with “contract renegotiations” and everything to do with a “comprehensive round of thorough testing and quality assurance activities.” However, the Reuters article quotes an Indian official as saying they have held a “number of discussions…for re-negotiation of the contracts.” Is contract renegotiation really the reason for Cove Point’s delayed start?…
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PTT Global Final Decision re Belmont Cracker Plant Late Again

An MDN reader recently asked us, “Hey, what’s up with the Belmont County, OH ethane cracker? We haven’t read anything in a while.” You haven’t read anything on MDN, nor anywhere else, because there’s been nothing to read. PTT Global Chemical, based in Thailand, announced in April 2015 they are interested in building a $5 billion ethane cracker plant complex in Belmont County, OH (see It’s Official: Belmont County Chosen as POSSIBLE Cracker Plant Site). In May 2016, a story in the Bangkok Post said the final investment decision (FID) will definitely come in 2017, but they called the decision “delayed.” PTT disagreed with that assessment, saying a decision coming in 2016 or 2017 is not “delayed” (see PTT Global Says Belmont, OH Ethane Cracker NOT Delayed). In December 2016, Belmont County officials said the FID would come by the end of March this year (see OH Cracker Final Decision Coming Soon, Site Now Cleared & Ready). But in February, PTT said the FID won’t come until “late 2017,” which is “several months later than we originally announced” (see PTT Global Delays Final Investment Decision for OH Ethane Cracker). It’s pretty “late” in 2017, wouldn’t you say? A company representative says the company will make some sort of an announcement “by the end of the year,” but that’s all he will say. It certainly doesn’t seem as if an FID is in the cards in the next three weeks…
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