Shell to Build $6 Billion Ethane Cracker in Pennsylvania

The new ethane cracker in Beaver County will look a lot like this Shell petrochemical complex in China. | Shell

Shell Chemical Appalachia LLC announced Tuesday that it will build a long-awaited petrochemical plant in Beaver County that boosters believe will transform the state’s shale gas industry.

Construction of the massive polyethylene complex  in Beaver County, just outside of Pittsburgh, will create up to 6,000 construction jobs and 600 permanent jobs upon completion in the next decade, the company said.

Pennsylvania officials courted Shell for more than four years to build the ethane cracker, which produces a raw material used in an array of chemical and plastic products.

“This is not just another company that is bringing ‘X’ number of jobs to Pennsylvania,” Gov. Wolf told the Inquirer on Tuesday. “This is actually something that is creating a foundation for a whole new set of manufacturing products.”

This huge facility is an example of the kind of petrochemical development some Philadelphia business leaders are hoping to cultivate here.

Following years of deliberation, Shell said its final decision was due, in part, to the tax incentives offered by the state.

In 2012, the state legislature agreed to give the ethane cracker $1.65 billion in tax credits over 25 years, according to the Pittsburgh Post-Gazette. Gov. Tom Corbett supported these incentives when he was in office, acknowledging the plant’s potential to become a catalyst for a manufacturing boom.

Shell said the plant’s location, within 700 miles of more than 70 percent of North American polyethylene customers, was also a deciding factor. And its competitive advantage is that it’s the only plant in the east the Inquirer reports. The company has also delayed or canceled some of its other projects to focus on this development.

“Shell’s decision to move forward with this world-class facility, which will put thousands to work across our region through utilizing clean-burning domestic natural gas for decades to come, is welcomed news, especially given the challenging market conditions,” Marcellus Shale Coalition president David Spigelmyer said in a statement.

But others aren’t welcoming the project so readily. Some environmentalists have noted that the ethane cracker, which requires its own power plant, will be a significant source of air pollution.

The Clean Air Council appealed state permits issued last year that do not require Shell to install air monitors around the plant. Shell installed such “fence-line” monitoring at other facilities it operates, but has refused to use it at the proposed cracker plant in Pennsylvania, Council executive director Joseph Otis Minott told the Inquirer.

But the governor believes Shell will be conscious of the issues raised by the environmental groups.

“They’re not in this to do something in the short run,” Wolf said. “They’re making a long-term commitment to Pennsylvania,” he told the Inquirer.