13 September 2011 21:44 [Source: ICIS news]
HOUSTON (ICIS)--The world's demand for ethylene will outstrip supply, causing 2012 operating rates to increase even with 2% GDP growth, US-based Dow Chemical said on Tuesday.
In the US, Dow stands to benefit because it can rely on the country's cheaper ethane-based feedstock, company said.
In particular, the US should have excess ethane because of the development of its shale-gas reserves, Dow said. In fact, futures markets have already priced in the excess ethane supply.
To take advantage of this cheaper feedstock, Dow has signed a memorandum of understanding (MOU) to access additional ethane supplies from the Marcellus shale in the northeast US, the company said.
On the ethylene side, Dow plans to restart a cracker in Louisiana by the end of 2012 and to increase ethane flexibility at a second cracker in the state in 2014, the company said.
In Texas, Dow plans to build an on-purpose propylene plant and increase flexibility of a cracker, the company said. On the US Gulf coast, Dow plans to build a world-scale cracker, with start-up in 2017.
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