07 January 2010 22:34 [Source: ICIS news]
NEW YORK (ICIS news)--Cheaper natural gas prices and a lower US dollar will revive the competitiveness of ?xml:namespace>
“Technology outpaces geological depletion – almost always. Technology for finding gas is improving and the cost falling to around $3-5 [per MMBtu] to extract shale gas,” said Fred Peterson, president of
Peterson spoke at a meeting of the Chemical Marketing & Economics (CM&E) Group in
“The effect on the Gulf coast is that the ethane supply will grow from around 800,000 bbls/day in 2009 to about 900,000 bbls/day in 2010,” he added.
Ethane, extracted from natural gas, is the primary feedstock for
The largest shale formation in North America is the Marcellus Shale, located in the northeast US, including
And increased extraction of natural gas from this region could one day lead to a cracker being built in the northeast US, he said.
“One natural gas liquids operator has said there will be enough ethane extraction to support a commercial-scale ethylene cracker,” said Peterson.
“Major chemical companies haven’t yet shown much interest, leaving room for an independent refiner or chemical company. But the ethane will be here in the next two-to-three years, and the incentive to build often leads to action - someone will do something,” he added.
On the currency front, a cheaper US dollar has made exports more competitive, and this trend will continue, said the consultant.
“The famed economist Milton Friedman said if you increase money supply, there will be inflation – end of story, and we think Friedman will be right,” said Petersen.
“No matter what happens, we think the US dollar will fall as the
($1 = €0.69)
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