MOSCOW (MRC) -- Borealis, an Austrian petrochemical company controlled by Abu Dhabi, signed a long-term ethane supply contract with Antero Resources as it pushes ahead with a plan to import cheaper US feedstock for its plant in Sweden, reported Hydrocarbonprocessing.
Navigator Holdings will undertake the shipping of ethane from the US, with the construction of a new vessel underway, the Vienna-based company said in a statement.
Borealis’ steam cracker in Stenungsund will see a multi-million investment to upgrade the facility and the construction of an ethane storage tank, it said without giving further details.
"We need to take advantage of the significant shift in ethane availability triggered by the US shale gas boom,” Borealis CEO Mark Garrett said in the statement. “In an increasingly challenging environment in Europe, this is an exciting opportunity to increase the competitiveness of our integrated polyolefins business."
Borealis is joining INEOS, Europe’s other owner of flexible crackers that can operate on ethane rather than naphtha, in tapping cheap feedstock from the US Marcellus and Utica shale formations as North Sea energy supplies wane.
A rennaissance in the US chemical industry, fueled by shale, and increased production in the Middle East and China poses a threat to European plants. While BASF’s petrochemical facilities are fully integrated into its naphtha cracker, helping maximize efficiency, isolated petrochemical plants will face the greatest cost presssure.
As MRC informed previously, in May 2014, Jacobs Engineering Group received a contract from Borealis to provide engineering, procurement, project management and construction management services for a project to increase cross-linked polyethylene (XLPE) capacity at its manufacturing site in Stenungsund, Sweden. Under the terms of the contract, Jacobs is working to debottleneck an existing XLPE compounding and soaking train and increase the intermediate storage capacity of the XLPE base resin in the upstream polymerization plant.
Borealis is a leading provider of innovative solutions in the fields of polyolefins, base chemicals and fertilizers. The only polyethylene (PE) producer in Sweden, Borealis’ Stenungsund facilities include a PE plant, a cracker for ethylene and propylene production, and an innovation center focused on research and development for infrastructure markets.
MRC