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INEOS signs agreement with ExxonMobil and Shell to supply ethane

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Hydrocarbon Engineering,

INEOS Europe AG, ExxonMobil Chemical Ltd and Shell Chemicals Europe B.V. have announced a long-term sale and purchase agreement to secure ethane from US shale gas for the Fife Ethylene Plant (FEP) at Mossmorran in Scotland, from mid 2017. FEP is owned and operated by ExxonMobil and Shell has 50% capacity rights.

The Fife plant will receive ethane from INEOS’ new import terminal in Grangemouth, Scotland. This new source of feedstock will help complement supplies from North Sea natural gas fields.

“This is a landmark agreement for everyone involved”, said Geir Tuft Business Director at INEOS O&P UK. “We know that ethane from US shale gas has transformed US manufacturing and we are now seeing this advantage being shared across Scotland.”

“Today’s agreement helps to secure additional feedstock for the Fife plant,” said Karen McKee, vice president of ExxonMobil’s global basic chemicals business.

“This agreement gives FEP access to the new infrastructure developed by INEOS and in so doing brings US advantaged ethane to FEP. The agreement will help us to meet the long-term needs of our ethylene customers,” said Elise Nowee, General Manager Base Chemicals Europe, Shell Chemicals.

INEOS has committed £450 million to construct the new ethane import terminal at its Grangemouth facility. It represents the most significant investment in UK petrochemical manufacturing in recent times and is supported by both the UK and Scottish governments. An existing pipeline will transport the gas from Grangemouth to Fife.

The FEP is one of Europe's largest ethylene facilities and is one of only four natural gas-fed steam crackers in Europe. It was the first plant specifically constructed to use natural gas liquids from the North Sea as feedstock. Alongside INEOS Grangemouth, it supplies manufacturing in Scotland, the rest of the UK and export markets with ethylene. It has an annual capacity of 830 000 t of ethylene.

The agreement will ensure the competitiveness of a major manufacturing facility in Scotland as well as helping to secure long-term skilled jobs.

Edited from press release by

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