(Source: The Philadelphia Inquirer)
By Andrew Maykuth, The Philadelphia Inquirer
March 22--Sunoco Logistics Partners L.P. of Philadelphia announced plans Tuesday to convert an existing pipeline to deliver ethane from Marcellus Shale drilling to industrial customers in Ontario, Canada.
Sunoco Logistics, the pipeline affiliate of Sunoco Inc., said it would join with MarkWest Liberty Midstream & Resources L.L.C. to develop the project. MarkWest Liberty is a partnership between MarkWest Energy Partners L.P. and the Energy & Minerals Group, an investment fund.
The partnership will use new and existing pipelines to transport up to 65,000 barrels a day of ethane from Western Pennsylvania to petrochemical customers in Sarnia, Ontario.
Marcellus wells in southwestern Pennsylvania produce a sidestream of high-value liquid hydrocarbons such as ethane, butane, and propane, which must be separated at plants operated by companies such as MarkWest, a Colorado firm.
Ethane is a major ingredient in ethylene, which is used to produce plastics.
The companies declined to estimate the project's cost or earnings projections. Thomas P. Golembeski, Sunoco's spokesman, said the project was expected to go online in the third quarter of 2012.
The Canadian venture, in which MarkWest will construct of a 25-mile pipeline to connect to an existing Sunoco Logistics pipeline, is the second pipeline deal involving the partners.
Sunoco and the MarkWest group last June announced the Mariner Project, a plan to transport ethane from Western Pennsylvania to Philadelphia, mostly in existing pipelines. The supercooled liquid would be loaded onto vessels for shipment by sea to Gulf Coast customers.
Golembeski said the Mariner Project was scheduled to begin operations in 2013.
The pipeline projects address one of the challenges for Marcellus Shale operators: how to transport the growing volume of natural gas and its by-products to market.
Contact staff writer Andrew Maykuth at 215-854-2947 or amaykuth@phillynews.com.
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