If you’re buying a propane tank for your gas grill this summer, there’s a near-100 percent likelihood that the propane it contains was produced from gas extracted from the Marcellus Shale, according to MarkWest Energy.
Randy Nickerson, senior vice president and chief commercial officer for the Denver-based processor of natural gas, said that while there are currently several highly marketable distillates like propane coming from wet gas produced in Western Pennsylvania and West Virginia, ethane will have the biggest impact of all of them.
During a telephone interview with The Energy Report in late July, Nickerson said MarkWest, which in this area processes natural gas at its Chartiers Township fractionation plant for Range Resources, said the amount of propane now separated here makes it a product that almost certainly finds its way into the metal tanks sold at convenience and home improvement stores in the area.
“If you’re buying propane in Washington County it’s almost certainly gas coming from the Marcellus Shale,” he said. “It’s almost impossible to pick up one of those bottles and not have (propane) that came from the Marcellus.”
Perhaps the most interesting aspect about the fuel is that just a few years ago, Pennsylvania was a net importer of propane.
“Now we’re a net exporter,” Nickerson said, adding that the wet gas now being extracted from the Marcellus Shale is responsible for producing propane’s abundance.
MarkWest, which currently has a natural gas processing capacity of 355 million cubic feet per day at the local plant is also separating butane from the wet gas that arrives.
According to Nickerson, the regular butane is used in products like lighters, but a different one, known as isobutane, is used as a feedstock at refineries to help produce the various grades of gasoline, and finds its way to nearly all of the refineries in the Northeast.
Another wet gas product known as “natural gasoline” is also of particular value to the petrochemical industry in Western Canada, Nickerson said, where it is added to the heavy crude found in tar sands to make it more liquid-like and enable it to be transported through pipelines.
But Nickerson said the biggest product yet to come from the wet gas has the potential to make Western Pennsylvania a game-changer, petrochemically speaking.
The product is ethane, currently a byproduct that is left with methane to produce higher Britsh Thermal Units, or btus of energy.
“Before, ethane always stayed in the gas,” Nickerson said. “Now, there’s enough ethane that we can no longer leave it in the methane.
According to Nickerson, the advent of separating ethane and selling it to cracking plants to convert it into ethylene, the feedstock for producing a myriad of plastics, has the potential to make Washington County an international center for the product.
MarkWest is currently building a de-ethanization unit at its Chartiers plant that, when completed in mid-2013, will produce about 38,000 barrels per day of ethane. It’s also building about 40 miles of the Mariner West ethane pipeline, to be completed by the third quarter of 2013, that will connect with a Sunoco pipeline to transport 50,000 barrels per day of ethane for shipment to Canada. It’s constructing another 45 miles of the Mariner East line to connect to a Sunoco line that will carry propane to the refinery at Marcus Hook, Pa., for export overseas.
Nickerson said the possibility of Shell Oil building an ethane cracking plant in Beaver County and supplying ethylene for plastics and chemical manufacturing here and abroad has the potential to make Marcellus-produced ethane a determinating factor in world markets.
“Washington County can now affect what goes on in Tokyo, Japan. What goes on in Washington County affects the world.”
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