NPRA ’11: US policy said to threaten decade of petchems growth

28 March 2011 02:50  [Source: ICIS news]

SAN ANTONIO, Texas (ICIS)--A top US petrochemicals industry leader warned on Sunday that federal policymakers are throwing roadblocks in the path of what otherwise could be ten or more years of chemical and general US economic growth.

Charles Drevna, president of the National Petrochemical & Refiners Association (NPRA), told a press conference that the mood among industry officials attending this week’s International Petrochemical Conference (IPC) was very enthusiastic.

Citing slow but continuing growth in the US economy and worldwide gains in gross domestic product (GDP) since the end of the recession in mid-2009, Drevna said “I see a lot of enthusiasm for the petrochemicals industry going forward for the next decade, if not more”.

But he cautioned that a decade of improvement was not guaranteed, and that US federal policies could offset prospects for growth.

“We’re hoping, and we’re keeping our fingers crossed, both as citizens and as a nation, hoping that our leaders get the economic situation under control so we can continue to grow,” he said.

“There are things that our officials can do to throw roadblocks in the path of that growth,” he said.

Drevna identified three particular areas where, he said, federal policies could thwart any advance in petrochemicals and the broader US economy.

“First, is the attempt to regulate greenhouse gases by the EPA through the Clean Air Act,” he said, referring to the Environmental Protection Agency.

The EPA in January this year began its controversial programme to limit and eventually reduce greenhouse gas (GHG) emissions by “stationary sources”, meaning petrochemical plants, refineries, electric utilities and other major production facilities.

The plan is opposed by multiple industrial groups and is the target of as many as 75 lawsuits challenging the agency’s authority to regulate greenhouse gases.

“We saw in the past two years that Congress could not agree on any path forward on regulating greenhouse gases, any way forward that would not put the US economy into a tailspin,” he said, arguing that EPA has exceeded the will of Congress with its GHG restrictions.

“You want to stop our economic progress in its tracks, then regulate greenhouse gases while the rest of the world continues to grow,” he said.

The second roadblock to petrochemical growth, he said, was also the work of EPA, with its effort to lower still further national ambient air quality standards (NAAQS) for ozone and other pollutants.

NPRA and other industry representatives have complained that EPA is calling for ozone standards so low that they would in some cases be below the level of background ozone contamination in open country.

The association also has opposed the new NAAQS requirements on grounds that the results of the earlier ozone standards are not yet known.

“You can’t keep changing these standards year after year without evidence of how the previous standards worked,” he said.

Lastly, Drevna criticised the administration of President Barack Obama for seeking to put limits on production of vast new US shale gas resources.

In  particular, NPRA petrochemicals vice president Jim Cooper cited a planned EPA two-year study of the environmental impact of hydraulic fracturing (fracking), charging that the scientific panel the agency has assembled to frame the study lacks hands-on industry representation and could “stack the deck” against industry.

Hydraulic fracturing is a 60-year-old drilling technique that in the last several years has been successfully employed to free-up vast shale gas deposits that previously could not be economically produced.  Industry worries that severe restrictions on fracking could proportionately reduce production of abundant shale gas resources.

Drevna warned that “without the ability to develop those shale gas resources, this could put this country back decades, perhaps never to recover.”

“I hope rational thought will prevail, and I hope it will happen in a timely fashion,” he said.

Drevna and Cooper spoke with reporters on the opening day of the 36th annual IPC.  Sponsored by NPRA, the conference runs through Tuesday, 29 March.

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy

By: Joe Kamalick
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