CADIZ, Ohio - The ethane being produced in the Marcellus and Utica shale region should be enough to support construction of several ethane crackers, officials with MarkWest Energy believe.
MarkWest has invested $2.2 billion into pipelines, processing and fractionation plants in the region. The fractionation plant at Hopedale, Ohio served as the destination of the six "superloads" that recently made their way through Steubenville.
"There is plenty of gas to go around," said Greg Sullivan, area manager for MarkWest. "We probably have enough work here to expand for another five years."
WHERE THE SUPERLOADS WENT — These large natural gas tanks recently passed through Jefferson County as so-called “superloads.” They will hold propane, butane, isobutane and other natural gas liquids at the MarkWest Energy Hopedale plant. -- Casey Junkins
MarkWest has contracts to process Ohio gas for Gulfport Energy, Antero Resources, Petroleum Development Corp. and Rex Energy. The company also processes gas at the Mobley site in Wetzel County and the Majorsville complex in Marshall County, working for producers such as Magnum Hunter, Consol Energy, Noble Energy and Range Resources.
"We are going to be here for a long time," added Robert McHale, manager of government and regulatory affairs for MarkWest.
Process and Ethane Cracker
At the Cadiz processing complex, MarkWest lowers the pressure of the gas stream to separate the gases once it is piped into the facility. This strategy involves a turbo expander, which McHale and Sullivan called "the heart of the cryogenic process."
"This gives us the cold that we need to separate the gas," Sullivan said.
The Cadiz processing complex will soon include two de-ethanizers, which will remove ethane from the gas stream.
Currently, the company has three options for its ethane: send it to Canada for cracking via the Mariner West Sunoco pipeline; send it to the Gulf Coast for cracking via the ATEX Express pipeline; or send it to the Gulf Coast for cracking over the Bluegrass Pipeline.
"Because there is no cracker in this region, this is what we can do with our ethane," McHale said.
Sullivan and McHale are confident there is more than enough supply of ethane in the Utica and Marcellus shale regions to justify building cracker plants.
McHale said that MarkWest projects it will be able to de-ethanize 200,000 barrels of ethane daily by 2017.
"There is plenty of ethane to support several crackers. Bring more," Sullivan said.
For MarkWest, the dry methane and the ethane will be removed from the gas stream at Cadiz. However, the propane, butane, isobutane and other heavier natural gas liquids flow via pipeline from Cadiz to the Hopedale fractionator for further separation.
According to www.naturalgas.org, "Fractionation works based on the different boiling points of the different hydrocarbons in the NGL stream. Essentially, fractionation occurs in stages consisting of the boiling off of hydrocarbons one by one."
"Propane is in great demand right now," McHale said. "And it is not just for backyard grilling. It can provide feedstock for the petrochemical industry."
Sullivan said there are now about 2,500 construction employees working to build the Harrison County plants and the pipeline network to which they connect, a number he believes will increase in the near future.
"We hire both union and non-union," McHale added. "We have found that in this area, union labor is competitive with non-union."
Although there are only eight full-time permanent jobs at the Cadiz plant right now, Sullivan and McHale said this number soon should show a major upswing, citing MarkWest's Pennsylvania operations.
"We started construction in Pennsylvania in April 2008 with nine operators. There are now about 320," McHale said.
Noting the Ohio Valley's long reputation of steel production, McHale said, "The only bad thing about this shale development is that it happened too late to save the mills."
"Anytime there is a well drilled, you have to get pipe connecting it to something," Sullivan added, noting the once thriving steel mills could have manufactured this product. "There are going to be wells drilled around here for years to come."
However, Sullivan said he has some former Wheeling-Pittsburgh Steel Corp. employees now working in his operation, noting, "They are great workers."
"This area is blessed with people who work hard," McHale said.