Enterprise Products Partners mulls expansion at polymer grade propylene fractionation facility at Texas

Enterprise Products Partners L.P. plans to expand its polymer grade propylene (PGP) fractionation facility at the partnership's Mont Belvieu, Texas complex, which will add on an annual basis, approximately 7,500 bpd (500 mln lbs) of incremental PGP production. The expansion is expected to be in service in Q1-2013. When completed, the expansion would increase Enterprise's net capacity to produce PGP at its Mont Belvieu facility by more than 10% from 73,000 bpd (approx 4.9 bln lbs pa) to roughly 80,500 bpd (5.4 bln lbs pa). To produce PGP, which is approximately 99.5 percent pure propylene, Enterprise fractionates refinery grade propylene (RGP), which is approximately 60 percent to 65 percent propylene, with the remainder being propane and butane. PGP is used in the production of plastic consumer products, coatings, pharmaceuticals, detergents and solvents. Since 2000, demand for PGP has increased by 20 percent; however, the supply of PGP produced as a co-product from the cracking of crude oil derivatives in the production of ethylene has declined approximately 40 percent. This decline is attributable to ethylene producers using more NGLs, such as ethane and propane, as feedstocks instead of more costly crude oil derivatives. "The shift to NGL feedstocks by the ethylene industry, which is driven by the disparity between natural gas and crude oil prices, has led to a significant reduction in co-production of propylene at North American petrochemical facilities," said A.J. "Jim" Teague, executive vice president and chief operating officer of Enterprise's general partner. "This is placing a premium on fractionation services like those Enterprise provides at its Mont Belvieu complex. Planning for future growth, we oversized portions of the last propylene fractionator we built in 2007, which results in lower capital costs associated with this current expansion." Refining economics that have led to increased availability of RGP on the market are also helping to drive the expansion project. The partnership has secured a portion of the feedstock required to supply the new fractionator and continues to work with various refiners. Additionally, the partnership has been in discussions with a number of petrochemical companies to acquire the incremental PGP production associated with the expansion. Enterprise has an extensive integrated propylene infrastructure system that complements the expansion project. With an RGP pipeline gathering system that connects to 13 refineries, as well as marine, rail and truck transportation capabilities at the Mont Belvieu complex, Enterprise can receive supplies from 57 facilities across North America and continues to look for other reliable sources of RGP. On the delivery side, Enterprise connects to 15 consumers of PGP propylene with two other connections under construction and scheduled for completion in 2011. The partnership also has the only operating PGP export terminal in the U.S., located in Seabrook, Texas. This facility enables Enterprise to provide PGP to growing international markets.
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