Petchems to have continued feedstock supply

25 May 2007 03:00  [Source: ICIS news]

By Florence Tan

HONG KONG (ICIS news)--The global petrochemical industry will continue to have access to reliable and affordable energy supplies as motor fuel feedstocks change in response to growing concerns over emission, an ExxonMobil senior official said on Friday.

“We will continue to see changes in the molecules available for our industry to use as feedstocks”, despite competition with the transportation sector for liquids from crude, Jim Harris, a senior vice president at ExxonMobil Chemical, said in a paper delivered at a conference in Shanghai.

“Will the chemical industry have continued access to the feedstocks it needs to support its continued growth and prosperity? The short answer is yes.”

The chemical industry used about 7% of global energy supplies in the form of energy and feedstocks, up from 4% in 1980, Harris told delegates at the China Petrochemical Focus 2007.

From 2006 through 2030, the chemical industry's demand for energy is likely to grow at a rate of 1.5% each year, he added.

Worldwide demand for petrochemicals was growing at a rate about twice that of world gross domestic product (GDP) with Asia and China markets driving much of the expansion, Harris said.

“By 2015, we expect Asia will account for 50% of global demand for key commodity products and China alone will account for 25%, he said.

“Over the next 10 years, we expect that some 60% of the world’s petrochemical growth will occur in Asia. Over one-third of that growth will be in China.”

ExxonMobil’s affiliates have invested nearly $3bn in China and its chemicals business generates about 10% of its sales from the country.

Exports were driving the Chinese petrochemical demand, but the growing purchasing power of the Asia’s expanding middle class will increase the need for high-quality products, Harris said.

The US major operates a plasticiser plant in Guangdong province, an adhesive resins joint venture with Shanghai Petrochemical.

It has also recently entered a $5bn joint venture with Sinopec and Saudi Aramco to triple the refining capacity in Quanzhou, Fujian province, to 12m tonnes/year and to build an 800,000 tonne/year cracker. These will start up in 2009.

By: Florence Tan
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