Ineos to supply US ethane to Scottish ethylene cracker

Ineos Europe AG, a unit of Ineos AG, Switzerland, has entered a deal for the long-term supply of US ethane supplies to ExxonMobil Chemical Ltd.’s 830,000-tonne/year Fife ethylene plant (FEP) at Mossmorran on Scotland’s eastern coast near Braefoot Bay, about 25 miles north of Edinburgh.

Under the agreement, Ineos will deliver price-advantaged US shale ethane supplies from its new Grangemouth import terminal along an existing pipeline to FEP beginning in 2017, Ineos said.

The US-sourced ethane supplies are intended to supplement FEP’s current supply of NGL feedstock from North Sea production by securing additional raw feed that to help the plant meet long-term needs of its domestic and international customers, according to FEP’s owner and operator, ExxonMobil Corp., and Royal Dutch Shell PLC subsidiary Shell Chemicals Europe BV, which holds 50% capacity rights in the venture.

The supply deal follows Ineos’ £450-million investment to build an import terminal and storage tank to store and process ethane from shale gas as part of a survival plan for its 210,000-b/d Grangemouth refinery which involves transforming the plant into a shale gas-based operation by 2016 in order for it to become a profitable business again (OGJ Online, July 17, 2014).

Ineos previously entered deals to secure US shale gas supplies for its European cracking operations with Consol Energy Inc., Pittsburgh, Range Resources-Appalachia LLC, and Enterprise Products Partners LP (OGJ Online, June 12, 2014).