By Kiley Bense, Inside Climate News
In 2020, the Department of Energy predicted that Appalachia was “on the cusp of an energy and petrochemical renaissance” fueled by abundant shale gas. The agency saw the ethane cracker plant Shell was building outside Pittsburgh as “the first of what could be multiple facilities” in Ohio, West Virginia and Pennsylvania.
Five years later, Shell stands alone, the only one of a fleet of proposed projects that was actually built. Now, the company would like to sell it.
“The issue is it’s our only one, our only major facility” that makes this kind of plastic, Shell CEO Wael Sawan told analysts in a recent earnings call. “And that’s why we’ve said we’re not the natural owner of that asset.” He acknowledged that a deal may not happen quickly but said the company is having “discussions” about a sale or partnership.
For people in Beaver County who have watched the planning, construction and opening of the plant drag out over the past 13 years, that possibility—first suggested in a Wall Street Journal story in March about Shell “exploring a potential sale” of its American chemical facilities—was surprising. Marcellus Drilling News, a fracking industry trade publication, called the news a “shocker.” Residents wondered if this meant the facility, which began operating in Monaca just three years ago, could be shut down or its workforce laid off.
In a statement to Inside Climate News, Shell spokesperson Krista Edwards said the company “has not announced any sale of its Monaca facility.” Shell is “exploring strategic and partnership opportunities” for its chemical facilities in the U.S., including Monaca, she said.
Shell’s CEO said that the company wants to go “back to what we call the brilliant basics”: oil and gas, not petrochemicals. The Monaca plant—which ended up costing $14 billion to build, $8 billion more than initial estimates—is a small part of its global portfolio. Shell was enticed to build in Pennsylvania when the state government granted the company a record-breaking $1.65 billion tax break that could last 25 years.
Financial experts said Shell Monaca’s location is one reason that a sale makes sense. “Shell is about as isolated in Pennsylvania as you can get,” said Rob Stier, a global petrochemicals expert at S&P Global Commodity Insights.
“Anything that goes wrong in Pennsylvania, the Shell Pennsylvania facility has to shut down,” he said. “If it’s running, it makes money. But if it’s not running, they’re in trouble.”
What he means is that Shell loses out whenever the plant falters because it has no other way to fulfill orders. In contrast, on the Gulf Coast, the home of a massive, interconnected petrochemical hub, companies can make up for losses by producing more at another facility. “Shell doesn’t have that luxury because they have Pennsylvania as their only polyethylene manufacturing site in the world,” Stier said. Polyethylene is the type of single-use plastic produced in Monaca. Shell uses ethane, a byproduct of natural gas, to make the plastic.
As of July 2025, Shell had submitted 80 malfunction reports to the state Department of Environmental Protection, according to the nonprofit FracTracker Alliance. It paid $10 million in civil penalties for air quality violations in 2023. Residents living nearby have complained about light, noise and air pollution and say the plant is disruptive to their daily lives, with some people choosing to move away to escape it. The Shell plant has an anticipated lifespan of least 25 years.
Stier said the market for polyethylene changed in 2022, the same year the Pennsylvania facility came online. Responding to increased demand for plastics domestically, China built more petrochemical plants. But in the last few years, demand there hasn’t kept up with all the new production, and the country is over capacity. That means fewer opportunities for American companies to sell in China, and it creates more competition for Shell in the U.S. market.
Shell Monaca still enjoys a competitive advantage because its feedstock costs less than the oil-based feedstock used in China.
“This is a valuable asset,” said Stier. The site is also likely to retain the huge tax subsidies it received from the state, even with a new owner, according to financial experts.
Shell’s Tax “Windfall” in Pennsylvania
Shell’s tax breaks from the state are behind its decision to push forward with the project even as other companies walked away from the “renaissance” for economic reasons, said Anne Keller, managing director at Midstream Energy Group, an energy consultancy. Keller has worked in the energy and petrochemical industry for more than 30 years. Compared to Ohio and West Virginia, Pennsylvania “far and away shelled out more money,” she said.
In 2016, then-vice president of Shell’s Appalachia Petrochemicals Division, Ate Visser, acknowledged the role the subsidies played in its decision-making. “I can tell you, hand to my heart, that without the fiscal incentives, we would not have taken this investment decision,” he said.
