Shell Oil Co. announced Monday it is developing plans to build a large Appalachian petrochemical plant to process or "crack" ethane from Marcellus Shale natural gas.

The plant's location is not yet determined, but ethane is a valuable side stream of Marcellus production in southwestern Pennsylvania and West Virginia.

Ethane is processed into ethylene and derivatives such as polyethylene, a raw material in plastics. Most of the material now produced in the region is shipped to Gulf Coast petrochemical plants.

"A typical cracker and derivatives complex would cost in the region of several billion dollars to develop, and 'world scale' crackers generally produce more than a million tons of ethylene per year, said Kelly op de Weegh, a Shell spokesperson.