Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you an email with your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list
Petrochemicals

Next Wave Energy opts for McDermott technology to build new Texas alkylate facility

Agriculture | Energy | Coal | Electric Power | Natural Gas | Oil | Metals | Petrochemicals | Shipping

2020 US Elections

Electric Power

Platts M2MS-Power

Energy | Electric Power | Electric Power Risk

Nodal Trader Conference, 13th Annual

Petrochemicals | Olefins

US Gulf Coast spot ethylene prices hit new low

Next Wave Energy opts for McDermott technology to build new Texas alkylate facility

New York — Next Wave Energy has awarded the process design package contract for a new 28,000 alkylate production facility to McDermott, the company said in a press release, as demand for alkylate is expected to rise with the onset of Tier 3 gasoline on January 1.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Next Wave's Project Traveler will be built in Pasadena, Texas, and will use McDermott's technology to "convert ethylene to butylene to produce a high-octane alkylate," McDermott said Thursday.

The project is expected to start-up mid-2022 and turn 1.2 billion pounds of ethylene feed into 28,000 b/d of alkylates.

Cracking of ethane in North America has resulted in an oversupply of ethylene and polyethylene, according to S&P Platts Global Analytics, which makes feedstock readily available to be turned into gasoline blending components such as alkylates.

Alkylate is used as an octane booster for gasoline. With the onset of Tier 3 lower sulfur gasoline specifications on January 1, 2020, alkylates will be a key source to replace octane lost as the sulfur is stripped out. Gasoline sulfur content will be lowered from 30 ppm to 10 ppm.

S&P Global Platts Analytics estimates that cat gasoline from the main gasoline-making fluid catalytic cracking unit accounts for about 30% of the US gasoline pool, with reformate, alkylate, naphtha and other components making up the rest.

And thus any octane loss could "be alleviated by increasing reformer throughput and severity," Platts Analytics said.

US catalytic reforming capacity has increased to 3.49 million b/d in 2019 from 3.39 million b/d in 2016, Energy Information Administration data shows, providing a ceiling on reformate prices. Reformate barges on the US Gulf Coast are averaging $2.26/gal so far in the fourth quarter.

US alkylate capacity has also grown, to 1.38 million b/d in 2019 compared with the 1.29 million b/d in 2016, according to EIA data, helping mitigate rising octane costs.

Octane is already more expensive on the US Gulf Coast, using the price difference between USGC 87 regular gasoline and higher octane USGC 93 premium as a metric, Platts price assessments show.

Fourth quarter to date in 2019, USGC 93 premium gasoline is holding an 18 cent/gal premium to USGC 87 unleaded regular gasoline, compared with the 14 cent/gal premium in the fourth quarter of 2018.

-- Janet McGurty, janet.mcgurty@spglobal.com

-- Edited by Debiprasad Nayak, newsdesk@spglobal.com