APIC ’08: Chems face energy challenge - Shell

28 May 2008 05:37  [Source: ICIS news]

By Abdul Hadhi

SINGAPORE (ICIS news)--Petrochemical firms face feedstock challenges even as the world consumes more of their products as global energy demand may double over the next 40 years, Shell Chemicals executive vice-president Ben van Beurden said on Wednesday

The UK-Dutch petrochemical giant was also considering building a styrene monomer/propylene oxide plant in Asia-Pacific as part of plans to grow its regional portfolio, he said in an address to the Asian Petrochemical Industry Conference (APIC).

Underlining Shell’s commitment to the region, Van Beurden said that "plans were under consideration for significant new manufacturing investments".

These plans, which include a "world-scale" styrene monomer/propylene oxide project, were aimed at strengthening Shell Chemicals' regional product and services portfolio.

“The key to this region’s and the world’s future success will be innovation to access energy for economic development, to provide new chemical feedstock sources and to develop cleaner, more energy efficient technology and products,” he said.

Population growth and rapid economic development in Asia could see the world using double the amount of energy in 2050 compared with current rates, he said, as well as raise petrochemicals demand as plastics continue to replace traditional materials.

Demand, however, will increase at a time when oil and gas extraction becomes more difficult and costly as much of the world’s energy resources were located in the Arctic or offshore in deepwater.

Despite a significant amount of ethane-based Middle East capacity coming on stream, naphtha is likely to remain as the major feedstock for petrochemicals and may pose a challenge as it tracks high crude.

To meet such challenges in the Asia-Pacific, Shell Chemicals has planned to move to more upstream products while focusing on earnings-driven downstream goods.

“Shell’s strategy is simple… upstream, we search for and recover more oil and gas… downstream, we manufacture and deliver products to our customers in a profitable and sustainable way,” Van Beurden said.

The company had steadily shifted investment in new production capacity towards the Middle East and Asia in the last 20 years and by 2010, around 30% of its chemicals production platform will be in the two regions, he added.

Carbon dioxide emissions were rising even faster than energy demand and without quick action, climate change consequences could be serious, Van Beurden added.

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ICIS and The Chemical Daily have produced an official 84-page special publication on Asian petrochemicals for the APIC event

By: Abdul Hadhi
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