A revolution. A game changer. Just one of the many descriptions given to the North American shale gas boom.
Horizontal drilling and fractionation of shale gas basins in North America is having quite an impact. You'll be hard-pressed to find a chemical or plastics conference that doesn't mention North American shale gas.
For instance, at the K 2013 preview, Josef Ertl, chairman of the German Plastics Industry Federation (WVK), said the U.S. has emerged as a very serious competitor lately, as its manufacturing operations can now use "exceptionally" cheap shale gas as an energy source.
"The United States of America are thus developing into a new global hub for petrochemicals," he said. "Many people are talking of the reindustrialization of the U.S. This could also have a lasting effect on the plastics landscape."
Or what about at the IHS World Petrochemical Conference (March 19-21; Houston, TX) when Stephen Pryor, president of ExxonMobil Chemical Co. , said in every country he visits, the conversation quickly turns to one topic: shale gas and its impact on the chemical business.
"Without question, the reversal of fortunes of the American chemical industry is one of the most remarkable stories flowing from the growth in unconventional oil and gas," Pryor said.
At ANTEC, Dwight Tozer, VP of the adhesion industry business of ExxonMobil Chemical, said that abundant U.S. shale gas supplies are revitalizing the plastics industry. ExxonMobil's outlook for energy indicates that the chemicals subsector of industrial energy consumption will be the fastest-growing area over the next 25 years, with demand expanding more than 50%, largely due to increased demand for plastics and other advanced products.
A study by American Chemistry Council says that plentiful and affordable natural gas supplies have transformed America's chemical industry from the world's high-cost producer five years ago to among the lowest-cost producers today.
The ACC believes that new supplies of natural gas from previously untapped shale gas deposits are one of the most "exciting domestic energy developments of the past 50 years."
Through the end of March 2013, nearly 100 chemical industry investments valued at $71.7 billion had been announced. The majority is being made to expand production capacity for ethylene, ethylene derivatives (polyethylene, polyvinyl chloride, etc.), ammonia, methanol, propylene, and chlorine.
"The U.S. is poised to capture market share from the rest of the world, and no other country or continent has as bright an outlook when it comes to natural gas," the ACC stated.
If all production goes as planned, it could be interesting times for North American chemical production.
Major impact in 2017
Robert Bauman, Polymer Consulting International, told PlasticsToday that shale gas is particularly abundant in the U.S., helping and that North America is become the second lowest cost ethylene producer in the world, which has led to major expansion activity.
There have's been plenty of announcements made regarding North American ethylene investments. As of now, there are seven new cracker projects planned for the U.S., which include Dow Chemical, ExxonMobil Chemical, Chevron Phillips Chemical, Shell, Formosa Plastics, Sasol and Occidental Chemical and MexiChem. Most of these