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Shell Gets Another Extension to Buy Cracker Plant Site
![](https://archive.businessjournaldaily.com/sites/default/files/Cracker250Good_2.jpg?1388070722)
YOUNGSTOWN, Ohio -- Shell Chemical LP wants more time to decide whether to build an ethane cracker plant in Monaco, Pa., but an announcement this morning suggests the conglomerate is leaning in favor of making the $3.2 billion investment.
Horsehead Holding Corp., parent of Horsehead Corp., says it has signed an amended and restated option and purchase agreement that extends the period of time during which Shell can continue to perform its evaluation of the Beaver County, Pa., location and exercise its option to purchase the site. Horsehead did not disclose when the new option agreement will expire.
What suggests a favorable inclination, according to Horsehead’s announcement, is the new agreement “provides for the start of demolition activities at the Monaca facility at Shell's expense. Demolition is expected to commence in the first quarter of 2014 with respect to certain portions of the site.”
Shell announced in March 2012 that it was considering the Horsehead site, an idled zinc processing plant that borders to Ohio River. Options to purchase the site were extended two times with the most recent extension set to expire Jan. 1.
On Aug. 27, Shell said is would accept bids through Oct. 4 from ethane suppliers for the proposed petrochemical complex. “Shell Chemical still has several critical milestones to achieve before making a final investment decision on whether to proceed with construction of this proposed complex,” Shell said at the time.
“Securing additional ethane supply is one of the key components in determining next steps as part of the ongoing site evaluation process,” the company said. “If the complex is built, Shell Chemical expects that its upstream affiliate, Shell Western Exploration and Production Inc., would provide a portion of the ethane supply for the proposed petrochemical complex. Shell Chemical has already secured supply commitments from CNX Gas Company LLC, a subsidiary of Consol Energy Inc, Hilcorp Energy Co., Noble Energy Inc., and Seneca Resources Corp.”
The proposed cracker plant would process "wet" ethane gas into ethylene, a primary ingredient used in plastics and other material.
Published by The Business Journal, Youngstown, Ohio.
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