Chemicals Major Ineos Will Construct a New Ethane Tank at Its Rafnes Site in Norway

Chemicals major Ineos said Tuesday it will construct a new ethane tank at its Rafnes site in Norway.

The project will allow the site to accommodate the ethane supply coming from the US starting in 2015. The ethane will be used to run the company's crackers in Europe.

Ineos said it has signed a letter of intent with TGE Gas Engineering to build the ethane tank and expanded infrastructure, which will be commissioned in 2015.

The tank will boost the existing storage capacity at Rafnes, which hosts a 560,000 mt/year cracker.

Once the contractual agreements are finalized, construction work is to start in February or March 2013 and will continue for 24 months, Ineos said, adding that the tank will store the first ethane loads from the second quarter of 2015.

"The investment in a new storage tank and infrastructure gives the site important long-term options, in addition to our current supply arrangements, to access raw materials from around the world," it said.

Tom Crotty, Ineos group director, told Platts in an interview in October that the company is planning to boost the capacity of the Rafnes cracker to around 700,000 mt/year to accommodate the US ethane gas supply.

The US ethane will also be fed into the company's 720,000 mt/year Grangemouth cracker in the UK, he said, but added that "complex logistics" are involved and have to be sorted out to bring the gas to the site.

Ineos said in late September that it had agreed a 15-year ethane supply agreement with Range Resources, an oil and natural gas producer in the eastern US and "pioneer" in the Marcellus Shale play. The ethane will be lifted from the Marcus Hook facility, located near Philadelphia, from 2015, when the delivery to Rafnes will also begin.