Shell gets extension on decision to buy land for Beaver County plant |

Shell gets extension on decision to buy land for Beaver County plant

Shell is waiting to commit to buy land for a much-anticipated petrochemical plant in Beaver County, but local and state officials said on Wednesday they don’t believe the delay will hurt the project’s chances.

“People are getting nervous because it’s not moving fast enough, but they told us last March it was going be a time-(consuming) process,” county Commissioner Tony Amadio said. “They’re keeping us in the loop ,and each time we meet we move a step forward, meet a person higher up the chain at the company. So that tells me we’re progressing.”

The chemical arm of Royal Dutch Shell plc had a Dec. 31 deadline to buy land in Center and Potter, but the company and landowner Horse­head Corp. signed a six-month extension, officials from both companies said. Shell may build a multibillion-dollar ethane processing plant on the site but needs more time to assess its suitability, Shell spokeswoman Kimberly Windon said in an email.

An official at Horsehead could not be reached for comment.

State leaders and others courted Shell officials and pitched the project as a potential economic boon. The plant would take ethane, a byproduct of gas drilling in the Marcellus shale, and convert it into the building blocks for plastics.

County officials said they knew for weeks that Shell might get an extension. The company has been very deliberative, sending surveyors and engineers to study the site, now a zinc smelter, and test for environmental contamination. The company has to gauge competition nationally, industry experts have said.

“It’s not unusual for this type of thing to happen. It doesn’t mean that they’re backing out or thinking of it, necessarily, but … they certainly haven’t committed themselves and they could have,” said Glenn Giacobbe, a Houston-based analyst who has studied petrochemical plant investments for the consulting firm IHS. “What you’re uncovering here is the usual dance. Each little step itself is not a game-changer, but it’s part of the puzzle.”

Hope for the project has been building for more than a year. Spurred by supply of shale gas from the Marcellus and Utica formations, Shell announced in June 2011 it might build the first ethane-to-plastics plant in Appalachia. Its construction might require up to 10,000 workers and the plant itself may employ 400, Shell officials have said.

Pennsylvania, Ohio and West Virginia all competed to land the plant — commonly called a cracker — based on estimates that its spin-off businesses would create up to 8,000 jobs. Pennsylvania offered a tax-free zone for the plant and other credits for ethane use that probably will be worth more than $1 billion over 25 years.

Shell struck a deal with Robinson-based Horsehead for its 300-acre site on the Ohio River but has never publicly committed to build. Some national experts have been skeptical of the project in part because of increasing competition, all drawn by cheap shale gas. About 10 other similar projects are on the drawing board — several further along than Shell’s — crowding the market to sell the products made from the plastics and even to get the construction workers to build the plant, experts have said.

“It’s too early for it to be a concern. Quite frankly, I don’t think Shell has all its ducks in order,” said Kent Moors, scholar in residence at the Institute for Energy and the Environment at Duquesne University. “If I were Shell, I’d be under no particular pressure to make a decision now … on land that clearly isn’t going anywhere.”

Timothy Puko is a staff writer for Trib Total Media. He can be reached at 412-320-7991 or [email protected].

TribLIVE commenting policy

You are solely responsible for your comments and by using you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.