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China’s Zhejiang Satellite Wins Approval for $4B Petchem Plant to Use U.S. Ethane

A large Chinese chemical producer has won regulatory approval to start building a $4.2 billion petrochemical complex in east China to process ethane from the United States, a company official said. Zhejiang Satellite Petrochemical Co Ltd’s plant will be the second China-based petrochemical facility aiming to cash in on cheap and abundant U.S. ethane unlocked by the shale revolution in North America, analysts said.Zhejiang Satellite will start construction in September on a 1.25 million tonnes per year (tpy) ethylene plant in Lianyungang in Jiangsu province, Ding Liping, an investor relations officer, told Reuters. “This is the company’s phase-one investment for a total of 2.5 million tonnes per year ethylene production facilities that will process fully U.S. ethane,” said Ding, adding that construction was expected to take about a year. Source: Hydrocarbon Processing, 8/29/2019. TCGR Note: An important trend. Last week Singapore’s SP Chemicals started a 650,000 mt/yr ethane cracker in Taixing, Jiangsu province. Zhejiang is expected to receive ethane from Energy Transfer Partners LP in the 4th Quarter, 2020 under a 10 year agreement at 3 MIL mt/yr. INEOS is suppling SP Chemicals’ needs.