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La. cracker to use Marcellus, Utica shale gas will proceed

WHEELING, W.Va. — At least one new multi-billion-dollar ethane cracker will process material from the Marcellus and Utica shale regions – once it travels to Louisiana via pipeline for use at the Axiall Corp. and Lotte Chemical Corp. petrochemical plant.

After several months of discussion, officials with Atlanta-based Axiall and South Korea-based Lotte decided they would proceed with their new facility, which they hope will yield 1 million metric tons of ethylene per year upon completion. Officials with the firms believe they can get their complex up and running by 2019.

“We are pleased to approve these projects and look forward to starting construction in 2016 with our partner Axiall to develop a world-scale ethane cracker fed by U.S. shale gas,” Lotte Chemical President and CEO Soo Young Huh said. “This investment will build on Lotte Chemical’s global ethylene construction and operating capabilities and increase our manufacturing presence in the North American market.”

Officials with the Energy Information Administration said total U.S. ethane production grew by an average of 212,000 barrels per day from 2010 to March of this year. Moreover, industry leaders believe ethane yields from just the Marcellus and Utica shales could reach 590,000 daily barrels by 2020, compared to none at all in 2012.

Lotte operates three crackers in Asia that produce more than 2.8 million metric tons of ethylene annually. Axiall now manages the Natrium chemical production site along W.Va. 2 in Marshall County that once operated under the PPG Industries badge.

“Today’s announcement represents a significant investment for the long-term benefit of both of our companies and a significant milestone in our company’s history,” Axiall President and CEO Tim Mann said.

Chicago Bridge & Iron Co., more commonly known as CB&I, received a contract to install its ethylene technology at the Axiall and Lotte plant. This firm has participated in several projects in the Upper Ohio Valley, notably the construction of the Blue Racer Midstream Natrium natural gas processing plant.

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