Borealis to source ethane from US for its petrochemical plant in Sweden

Austrian chemical company Borealis has signed an ethane supply deal with Antero Resources from US gas fields, for its flexible steam cracker in Stenungsund, Sweden, to take advantage of cheaper feedstock.

 

As part of the ten-year deal, Antero Resources will source and supply ethane gas from the Marcellus and Utica shale formations to Borealis in Stenungsund.

 

Borealis chief executive Mark Garrett said: "We need to take advantage of the significant shift in ethane availability triggered by the US shale gas boom.

 

"In an increasingly challenging environment in Europe this is an exciting opportunity to increase the competitiveness of our integrated polyolefins business."

 

Recently, Borealis also signed an ethane supply contract with Statoil, offering the company an alternative source of feedstock for its Swedish petrochemical facility.

 

The latest project also involves a deal with Navigator, which will be responsible for shipping ethane from the US.

 

Navigator will build a 35,000m³ vessel equipped with dual fuel engines to transport ethane to Stenungsund.

 

Borealis is also modernising its steam cracker in Stenungsund, in addition to the construction of an ethane storage tank.

The company has signed a lump-sum turnkey contract with TGE Gas Engineering to build the tank.

 

Borealis Base Chemicals executive vice-president Markku Korvenranta said: "The ethane contract with Antero Resources in combination with the recently renewed North Sea-based ethane contract with Statoil provides us with an ideal portfolio of sources balancing cost competitiveness and supply security.

 

"This contract and the related investments underline our commitment to further strengthen our monomer position in Europe."

 

Antero Resources has signed parallel fractionation, pipeline and terminal service contracts to allow free-on-board (FOB) delivery at the Marcus Hook terminal operated by Sunoco Logistics, with first delivery of ethane planned for late 2016.