The advent of shale gas (and shale oil) is having more profound effects than just on the production of energy or electric power. The development of “fracking” technology is providing an impetus for developments in the petrochemical industry which can be compared to the “golden years” which followed the introduction of catalytic cracking. Petrochemical processing costs are now lower in the US than in many other countries and there has been a sharp increase in projects for the “cracking” of ethane to make ethylene as a feedstock.
As put by the Financial Times: “The international chemicals industry is undergoing its most profound upheaval for 75 years, according to Kevin Swift of the American Chemistry Council. Not since the years before the second world war, when there was a flood of discoveries including nylon, synthetic rubber, PVC plastic and polystyrene, has there been technological change with such far-reaching consequences.”
The American Chemistry Council has just published its Year End 2012 Situation and Outlook and issued this press release.
HydrocarbonProcessing writes:
Favorable oil-to-gas price ratios driven by the production of natural gas from shale will drive a renewed US competitiveness that will boost exports and fuel greater domestic investment, economic growth and job creation within the business of chemistry.
This is according to the Year End 2012 Situation and Outlook, published Friday by the American Chemistry Council (ACC) trade group. ……
…. Access to vast, new supplies of natural gas from shale deposits creates a competitive advantage for US petrochemical manufacturers. Ethane, a natural gas liquid derived from shale gas, is used as a feedstock by American chemical companies, giving them an advantage over foreign competitors that rely on a more expensive oil-based feedstock.
“Following a decade of high and volatile natural gas prices that destroyed industrial demand and lead to the closure of many gas-intensive manufacturers, shale gas offers a new era of American competitiveness that will lead to greater investment, industry growth, and employment,” said Kevin Swift, ACC’s chief economist and lead author of the report.
The business of chemistry is a $760 billion enterprise and one of America’s most significant manufacturing industries, with more than 96% of all manufactured goods touched by products of chemistry. ……
….. According to Swift, it is not only the chemical industry that stands to benefit from increased access to natural gas from shale. Other natural gas and energy intensive manufacturing industries will also realize renewed competitiveness and increased output, potentially creating 662,000 direct and related jobs and generating $342 billion in economic expansion.
Within the business of chemistry, several end-use markets have already shown signs of growth. At nearly $3,650 of chemistry per vehicle, light vehicles represent an important market for the industry and productioncontinues to improve.
US light vehicle sales are expected to rise in 2013 and 2014 as pent-up demand, improved employment and greater availability of credit foster demand. The slowly recovering US housing market (more than $15,000 of chemistry per start) is also likely to spur demand.
Tags: American Chemistry Council, catalytic cracking, fracking, petrochemicals, Shale, Shale gas
The k2p blog 