1. History of the Site

2. Shell Involvement

3. Construction

4. Regional Economic Impact

5. Opposition to Project

6. References

The Pennsylvania Shell ethylene cracker plant is a chemical plant under construction in Potter Township, Pennsylvania near Pittsburgh that will be owned and operated by Shell Oil Company, the American subsidiary of supermajor oil company Royal Dutch Shell.^[1] The plant is being constructed near the interchange of Interstate 376 and Pennsylvania Route 18, expecting to open in the early 2020s.^[2]

History of the Site

The site of the proposed plant has had a long history as an industrial site. Both Horsehead Corporation and Koppers had plants on the site of the proposed plant, the latter company unofficially incorporating the area as Kobuta. Before its industrial use, the area had been farmland owned by a local family, which included a private cemetery (albeit with unmarked graves) that would later be discovered after Shell purchased the property for cleanup and would inform living descendants in the area of the skeletal remains.^[1]

Shell Involvement

Pennsylvania, Ohio and West Virginia engaged in a tax competition for the plant. In 2012 Pennsylvania structured a deal requiring Shell to invest at least $1 billion in Pennsylvania and create at least 2,500 construction jobs in exchange for a 25-year tax incentive of $66 million per year and tied to production, reducing Shell's tax by up to 20 per cent. The combined incentive could reach $1.65 billion.^[2][3] Shell announced the Pennsylvania site on March 15, 2012.^[4]

Shell began leasing the bulk of the property from Horsehead in 2012, which promptly closed the zinc plant on the site and began cleanup of the site in preparation of potentially opening a cracker plant on the site, which would be used to convert natural gas products into ethylene and then into plastics.^[1][5] Shell had selected the site due to the ongoing Marcellus natural gas trend and the site's prime location within the Marcellus Shale. By 2015, after executing several short-term lease extensions, Shell purchased the property outright from Horsehead, and subsequently purchasing other nearby properties, effectively absorbing all of Kobuta.^[6][7]

Shell pledged with Beaver County officials on environmental cleanup regardless if it opened the proposed plant, and at a worse-case scenario prepare the area land for at least some sort of future industrial use if Shell decided not to build there. This included building a massive bridge over PA 18, commenced in 2015,^[8] to connect both sides of the property without requiring an intersection along the route, as well as a Shell-funded rerouting of PA 18 and infrastructure improvements to I-376.

Despite a downturn in oil prices, on June 7, 2016, Shell announced it would build the plant.^[9][2] In a press release, Shell stated that 70% of polyethylene customers in North America are within a {{convert|700|mi|km|adj=on}} radius of Pittsburgh and that the location would be more cost-effective for its customers than at existing facilities along the Gulf Coast, which unlike North Central Appalachia are susceptible to the Atlantic hurricane season.^[10]

Construction

In 2015, Shell began preparing the site for any future construction, moving 7.2 million cubic yards of dirt, building new bridges, a new rail line, as well as a total relocation of PA Route 18. Construction on the plant itself began on November 8 2017, and is expected to continue through the early 2020s.^[11] The site will have four processing units, three of which will be polyethelene and one ethane cracker, a natural gas power plant to support both the plant and the local electric grid, a 900ft long cooling tower, numerous loading facilities for both trains and trucks, a water treatment plant, an office building, a laboratory, and an innovation center, once construction is complete.^[11]

On September 20, 2018, two of the world's largest cranes arrived on site. The largest of the pair is almost 700 feet tall and can lift 3,500 tons at a time, and is used around the globe on megaprojects. The smaller of the two is 430 feet tall and can lift about 2,300 tons in its current configuration.^[12]

On September 25, 2018 in a conference with the Wall Street Journal, Ben van Beurden, the CEO of Royal Dutch Shell, said that the project is both within budget, and ahead of schedule.^[13]

The Pennsylvania Department of Environmental Protection approved two permits for a 97 mile long pipeline that will lead to the cracker plant on December 20, 2018.^[14] Called the Falcon Ethane Pipeline, it will connect ethane sources in Houston, Pennsylvania, Scio, Ohio, and Cadiz, Ohio to the plant. Construction on the pipleine is expected to begin sometime in 2019.^[15]

Shell will also construct an 85,000 square foot innovation center at the site of the plant, including labs, a Center of Expertise, and an application hall. It's expected to be operational at the same time the rest of the site will be.^[16]

Regional Economic Impact

The opening of the cracker plant is expected to have a major economic impact on both the immediate area and the Pittsburgh metropolitan area in general. The plant is expected to create 6,000 construction jobs to build the site and 600 permanent jobs for employees working at the plant.^[9] It is also expected to expand neighboring Center Township, which had already seen a hotel construction boom in anticipation of the plant, as well as keep the Beaver Valley Mall afloat.^[17] A building dating to the 1920s in nearby Rochester that once served as a luxury hotel is being restored as such due to demand of the plant,^[18] while parts of the Northern Lights Shopping Center in Economy is being demolished for redevelopment, partially due to the plant.^[19] In 2018 Mount Airy Casinos won the licensing to build a satellite casino just 12 miles North of the cracker plant, planning to open in 2020.

The plant is also expected to spur long-delayed highway expansion projects. The Southern Beltway, which had already confirmed would be extending its second leg in 2020 from U.S. Route 22 to Interstate 79, moved the project up a year solely as a result of the proposed plant.^[20] In West Virginia, Interstate 68 has been proposed to be extended from Morgantown (where it currently terminates with I-79) to Moundsville (where it would terminate with West Virginia Route 2 just south of Wheeling) in response to Marcellus fracking as well as the proposed plant.^[21]

Opposition to Project

In late 2015, a group of environmentalists submitted an appeal to Pennsylvania's Environmental Hearing Board to challenge the air quality permit that was granted for the proposed plant; the group argued that the state should have required stricter monitoring requirements for fugitive pollutant emissions from the plant.^[22]

References

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