Air Products APD +0.97% , the leading global hydrogen provider, announced a long-term agreement with Enterprise Products Operating LLC, a wholly-owned subsidiary of Enterprise Products Partners L.P., that will increase hydrogen supply for refinery and petrochemical customers connected to Air Products' vast Gulf Coast Connection Pipeline system . Air Products will build, own, and operate a 40 million standard cubic feet per day (MMSCFD) hydrogen production facility to process a hydrogen-rich off-gas stream from a new propane dehydrogenation ("PDH") facility Enterprise is currently constructing in Mont Belvieu, Texas. The new PDH plant is scheduled to begin service in the third quarter of 2015.
"We are pleased to expand the long term relationship we have with Enterprise. This hydrogen source enhances our ability to meet the growing demand of our customers on our pipeline, and it helps increase the supply reliability and flexibility of our system. The established pipeline system was an asset in maximizing the value of this product since it enables us to purchase more off-gas during the life of the contract as we continue to meet our customers' growing demand," said Wilbur Mok, vice president – North America Tonnage Gases at Air Products. Mok pointed to a recent Gulf Coast refinery contract expansion with increased hydrogen supply of potentially up to 50 MMSCFD as one of the indications of the growing needs of the system.
Air Products has been successfully processing off-gas at Enterprise's Mont Belvieu complex since 1994, servicing an existing facility. The new Air Products facility will use the company's proven pressure swing adsorption technology which is already in place at numerous other locations around the world.
Overall, Air Products' Gulf Coast hydrogen system is the world's largest plant and pipeline network and provides over 1.2 billion standard cubic feet of hydrogen per day to refinery and petrochemicals customers. The 600 mile pipeline, which is fed by over 20 Air Products' hydrogen production facilities, stretches from the Houston Ship Channel in Texas to New Orleans, Louisiana.
Pipelines offer a safe, robust and reliable supply of hydrogen to the refinery and petrochemical industries around the world. Globally, Air Products' pipeline operational expertise is evidenced by nearly 40 years of safe operation of its network of systems. Besides the Gulf Coast pipeline system, Air Products also operates pipelines in California in the U.S.; in Rotterdam, the Netherlands; Sarnia, Ontario, Canada; and also a new extension to its existing Heartland Hydrogen Pipeline in Alberta, Canada which will stretch from Edmonton to Scotford.
Hydrogen is widely used in petroleum refining processes to remove impurities found in crude oil such as sulphur, olefins and aromatics to meet product fuels specifications. Removing these components allows gasoline and diesel to burn cleaner and thus makes hydrogen a critical component in the production of cleaner fuels needed by modern, efficient internal combustion engines.
