Shale Revitalizing Philadelphia’s Manufacturing Economy

Shale development continues to benefit the entire Commonwealth – our economy, workers, small businesses, consumers, air quality, as well as our region’s manufacturing base. It’s also increasingly clear that these benefits are reaching each and every county, including southeastern Pennsylvania.

In the summer of 2012, an IHS study found that “the phenomenal growth of shale oil and gas plays in the U.S. makes possible several reuse options that otherwise wouldn’t exist for the Sunoco Marcus Hook Industrial Complex, a former oil refinery located south of Philadelphia on the banks of the Delaware River that was shutdown in December 2011.”

When that study was released, an IHS expert offered this observation: “Without these plays, the options available to Marcus Hook would be more limited, and if pursued, could potentially provide an economic ‘second life’ to the complex, which has been a part of the Delaware County community since 1902.” At the time, Philadelphia’s local CBS affiliate reported this: “Delco Officials Think Sunoco Refinery’s Future Is In Marcellus Shale.”

Those predictions – enabled to safe and responsible shale development – are becoming a reality for the Greater Philadelphia economy and working families across the region. And today, MSC member Sunoco Logistics Partners announced a successful open season for its “Mariner East 2 project, the second phase of the Company’s broader plan to provide critical pipeline transportation from the Marcellus and Utica Shales.”

Here’s what they’re saying about today’s announcement:

  • Shale Boosting “Expansion of Manufacturing”: Sunoco Logistics says it will build a new pipeline of at least 16 inches in diameter to follow the route of its first Mariner East project, an 83-year-old fuel pipeline crossing Pennsylvania that the company is repurposing to carry liquids to Marcus Hook. Industry and political leaders have rallied behind the Mariner East projects as a first big link tying Philadelphia to the Marcellus Shale region, which now accounts for nearly a quarter of the nation’s natural gas production. … Mariner East 2 is expected to deliver 275,000 barrels per day of natural gas liquids (NGL) to Marcus Hook. Combined with Mariner East 1’s capacity of 70,000 barrels per day, the two pipelines will provide 345,000 barrels per day from the shale regions. That means the Marcus Hook complex will handling double the volume of fuel it processed during its previous lifetime as a Sunoco oil refinery. The former refinery, which had a capacity of 175,000 barrels of crude oil a day, closed in 2012 and is being dismantled to make way for its new life as an Marcellus energy hub. … Business and industrial leaders hope the Mariner East projects will boost the expansion of manufacturing. NGLs are primarily used a raw material in the petrochemical production. (Philadelphia Inquirer, 11/6/14)
  • “Vital Energy Project For Continuing Rebirth of Local Manufacturing Sector”: Sunoco Logistics Partners LP said it plans to invest about $2.5 billion in a project that will transport and process natural gas liquids from Pennsylvania’s Marcellus shale field and Ohio’s Utica shale field. The second phase of Mariner East project will move propane, ethane and other natural gas liquids from the shales to Sunoco’s Marcus Hook facility along the Delaware River in Pennsylvania, where the liquids will be processed, stored and distributed to various markets. “This vital energy project will provide a comprehensive solution in the region to transport, store and process NGLs from the Marcellus and Utica Shales, and will provide the foundation for the continuing rebirth of the local manufacturing sector,” said Michael J. Hennigan, president and CEO. “The project also enables the continuing development of the Marcus Hook Industrial Complex, as we convert a former refinery site into a world-class natural gas liquids hub in southeastern Pennsylvania.” (Reuters, 11/6/14)

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  • “Sunoco Logistics Plans Second, Larger Pipeline to East Coast”: “This vital energy project will provide a comprehensive solution in the region to transport, store and process NGLs from the Marcellus and Utica shales, and will provide the foundation for the continuing rebirth of the local manufacturing sector,” CEO Michael J. Hennigan, said in announcing the project. The project will move as much as 275,000 barrels a day of liquids such as propane, butane and ethane, which are produced in varying degrees by wells tapping the Marcellus and Utica shales. The initial Mariner East project, which is reversing flow on what was a diesel pipeline, which will have a capacity of 70,000 barrels a day, should begin pumping propane by the end of this year. … In addition to storage and export facilities at the Marcus Hook complex, Sunoco Logistsics said it also would build a plant there that converts propane to propylene, which is used by the chemical industry to make certain products. (Pittsburgh Tribune-Review, 11/16/14)
  • “Sunoco Moves Ahead With Large Pipeline Project Stretching Through Southwestern Pa.”: Sunoco Logistics Partners is moving ahead with its Mariner East 2 pipeline, announcing Thursday that it has concluded a successful open season for its capacity. The company said it will spend an estimated $2.5 billion on the pipeline, which will parallel its Mariner East line, carrying natural gas liquids from western Pennsylvania, West Virginia and eastern Ohio to Sunoco Logistics’ Marcus Hook Industrial Complex along the Delaware River. This line, however, will be larger than Mariner East, with almost four times the capacity. Whereas Mariner East has a capacity of 70,000 barrels per day of natural gas liquids, Mariner East 2 is to have a capacity of 275,000 barrels per day. (Pittsburgh Business Times, 11/6/14)

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