State-owned Thai oil and gas company PTT Pcl said its U.S. unit took a step forward on its proposed chemical plant in Ohio that will turn ethane into plastics with an agreement to develop a natural gas liquids storage facility.
PTT Global Chemical America (PTTGCA) signed an agreement with Energy Storage Ventures LLC to build a facility to store and transport natural gas liquids (NGL) for PTTGCA's proposed complex.
“Our impending partnership ... brings us one step closer to a final investment decision," PTTGCA President and Chief Executive Toasaporn Boonyapipat said in a statement on July 22.
In June, PTTGCA said it delayed making a final investment decision to build the ethane cracker, which analysts estimate will cost $5.7 billion, from the first half of 2020 to the first half of 2021 due to the coronavirus.
Analysts said the pandemic reduced expected growth in global demand for plastics.
Energy Storage Ventures' Mountaineer NGL Storage subsidiary will develop the underground salt caverns on a 200-acre (80-hectare) site in Ohio’s Monroe County about 8 miles (13 km) from the PTTGCA site.
PTTGCA said it is working with Mountaineer on 1 million barrels of ethane storage and a pipeline linking the storage facility to the project.
PTTGCA said Mountaineer will develop the $250 million storage facility in two phases by creating multiple caverns in the existing underground salt formation. Each phase will be able to hold about 1.5 million barrels.
PTTGCA said it is seeking new partners for its ethane cracker project after South Korea's Daelim Industrial Co Ltd pulled out earlier this month.
The ethane cracker is designed to produce about 1.5 million metric tons of ethylene per year and will take 4-6 years to build.
In addition, to PTTGCA's project, Royal Dutch Shell Plc is building an ethane cracker nearby in western Pennsylvania.
The oil and gas industry was not sunk, but 2020 did damage that will take time to assess before deeming it as salvageable or a wreck.
The disappointment at Hassa-1 comes after Exxon said in November its crude discovery at the Tanager-1 well in the Kaieteur block was not financially viable on its own.
In a separate statement, TNOG owner Heirs Holdings said it had taken a 45% stake in the field, acquiring the stakes of Shell, Total and Eni.