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Race For Cracker Plant Heats Up

By Staff | Feb 1, 2012

Bryan Iams, spokesman for Bayer Corp., said the company’s Proctor location remains under consideration for an ethane cracker plant on adjacent property. (Photo by Casey Junkins)

If Sen. Bob Casey gets his way, West Virginia-based Aither Chemicals will have its $750 million ethane cracker up and running by 2016 in Pennsylvania.

At the same time, officials with Bayer Corp. remain optimistic that Aither, Royal Dutch Shell, or some other company will build a cracker at one of Bayer’s two main West Virginia sites, Institute (near Charleston) or along the Ohio River near New Martinsville.

“Right now, we are looking at New Martinsville and other sites in West Virginia,” said Leonard Dolhert, chief executive officer of South Charleston-based Aither. “We are also looking at sites in Pennsylvania, including Aliquippa.”

As Casey, D-Pa., previously did with executives from Shell regarding that company’s planned multibillion-dollar ethane cracker, he sent a letter to Dolhert to urge him to bring the plant to Pennsylvania.

“Building a new ethane cracker plant in southwest Pennsylvania will mean major job creation and economic growth, so it’s crucial that this new plant come to our state,” Casey wrote.

“Pennsylvania has everything needed to make it a top choice for an Aither facility: an increasing supply of ethane, appropriate real estate, and a ready local market for its products as well as an extensive transportation system,” he continued.

Casey enters the cracker contest with West Virginia Gov. Earl Ray Tomblin and Ohio Gov. John Kasich, both of whom have flown to Houston to meet with gas company executives to promote their states as the best location for a cracker, which some estimate will cost as much as $3.2 billion.

All three states have created special tax incentive packages in an effort to attract a cracker developer.

Although not quite to the scale of the Shell project-that leaders expect to employ as many as 10,000 construction workers and several hundred permanent employees upon completion of the plant-the Aither cracker could help spur industrial growth throughout the Marcellus and Utica shale regions. Dolhert said this particular project should employ about 2,000 construction workers and roughly 200 chemical employees by the time it begins cracking, or processing ethane.

Dolhert said he has “extreme interest” in his project now, noting he has communicated with Ohio and West Virginia leaders in addition to Pennsylvania’s Casey.

“Our technology allows us to be flexible in how large we ultimately make this thing,” Dolhert said.

Company information states Aither is a petrochemical firm whose technology will use a patent-pending catalytic cracking method to transform the ethane into ethylene, which is the basis for plastic production.

The technology will, according to the company, allow Aither to operate at a lower cost than most crackers, while using 80 percent less energy and producing 60 percent less carbon dioxide.

In addition to ethane, other natural gas liquids produced in the “wet” Marcellus and Utica shale gas are propane, butane, and pentane. These elements must be stripped away from the methane natural gas at processing plants-such as those operated by Caiman Energy, MarkWest Liberty, and Dominion Resources-so the methane can be sold by utility companies.

After the ethane is separated from the other gases, it must be shipped to a cracker or placed into a pipeline. Chesapeake Energy, Range Resources, and Caiman are planning to send local ethane to Texas or Canada, respectively, partially because there is no cracker in the area now.

When word of the possible ethane cracker first surfaced, many believed the site adjacent to the local Bayer plant would be ideal for such a facility. Bayer spokesman Bryan Iams said his company is doing the best it can to make sure a cracker comes to West Virginia.

“We continue to market our two sites, and we remain in discussion with companies regarding these sites,” Iams said, declining to provide more specific details.