Ineos to Ship US Ethane to China

Ineos has taken another industry lead with a deal to ship ethane derived from US shale gas to China. The UK-headquartered group has entered into a long-term supply agreement with Singapore-based SP Chemicals to provide the gas feedstock starting in 2019.

“This is another world first for Ineos after importing shale gas to Europe in 2015,” said David Thompson, CEO of Ineos Trading and Shipping. “By bringing in US ethane from shale gas to China for the first time, we are now leading the way in shipping ethane worldwide to meet the needs of an expanding chemicals sector.”

A very large ethane carrier (VLEC) with a capacity of 95,000 cubic meters will be built in China under the management of the Jaccar Group. The vessel, expected to be the world’s largest ethane carrier, will be operated by Denmark’s Evergas, which is wholly owned by Greenship Gas & Jaccar Holding. Evergas has designed a series of dragon-class ships, which Ineos is currently chartering to ship ethane across the Atlantic to its crackers in Scotland and Norway.

The VLEC will transport the ethane more than 18,900 km across the Pacific Ocean to SP Chemicals’ 650,000 t/y ethylene plant, which is under construction in Taixing City, Jiangsu province, and due on stream in 2019. “It has long been a dream for SP Chemicals to integrate upstream. This first long-term supply agreement for ethane with Ineos will be an important milestone for SP Chemicals to achieve self-sufficiency for its ethylene requirements,” said Chan Hian Siang, CEO of SP Chemicals.

French engineering group Technip won a contract in February 2016 from SP Chemicals to provide technology licensing and process design for the plant, which is said to be China’s first gas-cracking ethylene facility.