MarkWest, Sunoco in Deal to Provide Marcellus Ethane Byproduct

Washington PA Observer Reporter
4 June 2010

MarkWest Energy Partners, L.P. and Sunoco Logistics Partners L.P. have announced a combined pipeline and marine project for ethane produced in the Marcellus Shale Basin, with MarkWest’s Houston fractionalization plant serving as the centerpiece for the project.

According to a press release, the Mariner distribution project is anticipated to have initial capacity to transport up to 50,000 barrels per day of ethane, a byproduct of natural gas that is used as a feedstock for ethylene production.

The partnership said it plans to ship the ethane to Gulf Coast markets as soon as the second quarter of 2012 and said the project could be scaled to transport higher volumes to support additional ethane production in the Marcellus region.

MarkWest, through its Liberty Midstream & Resources division, has been working with key producers and petrochemical consumers since late 2009 and the project is supported by key producers including Range Resources and Chesapeake Energy.

The Mariner Project includes MarkWest Liberty making minor modifications to its processing facilities to recover sufficient ethane to allow the residue gas to meet interstate gas pipeline specifications and installing additional facilities at its Houston processing complex to separate the ethane for delivery to downstream Mariner Project facilities.

MarkWest Liberty will also construct a 45-mile pipeline from the Houston complex to an interconnection with an existing Sunoco Logistics pipeline at Delmont in Westmoreland County.

The ethane will be transported to an existing East Coast facility where Sunoco Logistics will construct refrigerated ethane storage facilities. It will then be transported via marine vessel to premium markets in the Gulf Coast. In addition, the existing Sunoco Logistics pipeline crosses many of the large pipelines transporting natural gas into the northeast, which will provide multiple ethane blending options.