It’s All About Shale Gas

Business, Company Strategy, Olefins, Polyolefins, Projects, US

By Malini Hariharan

As expected, excitement around shale gas is running strong at the CERAWeek conference in Houston. But an element of caution is also visible with the majors appearing to be in no rush to finalise their investments.

Shell is still a few years away from taking a final investment decision on a proposed cracker in the US, said CEO Peter Voser. Shell is considering Pennsylvania, Ohio and West Virginia as possible sites for the project and is likely to firm up a location one early this year.

But Voser said the company could still have the cracker up and running by 2017 if it began construction in 2014.

Chevron Philips Chemical is still evaluating sites for new polyethylene (PE) plants, said Mark Lashier the company’s executive vice president of olefins and polyolefins. Chevron Phillips plans to build a 1.5m tonne/year ethane cracker and two PE plants, each with a capacity of 500,000 tonnes/year.

The company has already chosen its Cedar Bayou site in Baytown, Texas, for its cracker.

The shale industry is still evolving and that is evident in the reports of US shale operators shifting their focus to oil production because of low gas prices.

Steven Mueller, the president and CEO of Southwestern Energy, said shale gas production has created a glut of 500bn cubic feet of gas.

Charles Stanley, the president and CEO of QEP Resources, said the industry is pulling capital from dry gas plays to plays rich with natural gas liquids and crude oil, which will act as a balancing mechanism by reducing natural gas production.

Shifting from gas to oil requires adjustments in well placement as oil does not flow as easily as gas. But it appears companies are slowly learning how to do this.

Industry players also acknowledged that environmental issues could well delay the progress of shale gas.

Methane emissions are an area of concern. “Some environmental groups that once supported switching from coal to gas for electricity generation are no longer doing so over concerns about methane leakage,” pointed out Voser.

Peter Oosterveer, Fluor’s group president for energy and chemicals, stressed that the industry needs to be upfront and transparent about the potential risks of fracking.

“I don’t think the industry does that particularly well,” he said. “The challenge with shale gas is it is a fragmented industry, with a lot of small players.”

But as pointed out by Oosterveer, the stakes are too high for the industry to dodge their social responsibility.

PREVIOUS POST

Butadiene Set To Decline Further

08/03/2012

By Malini Hariharan As expected, excitement around shale gas is running strong a...

Learn more
NEXT POST

China Auto Sales Point To Long-term Shift

12/03/2012

By Malini Hariharan As expected, excitement around shale gas is running strong a...

Learn more
More posts
China benzene spreads at ten-year low on misplaced trade deal hopes
19/05/2019

By John Richardson THE ABOVE chart shows that in April the average spread between CFR Japan naphtha ...

Read
Longer trade war: Impact in numbers on China polymers demand
15/05/2019

By John Richardson WE MUST now start to quantify the impact on the petrochemicals industry of no end...

Read
Plastics pollution crisis: Impact on polyethylene margins in 2022-2027
13/05/2019

By John Richardson ALMOST all countries late last week signed a UN deal to monitor the flow of hard-...

Read
China PE demand boom will not stop further margin declines
10/05/2019

By John Richardson CHINA’S polyethylene (PE) market is being temporarily weighed down by overstock...

Read
China holds all the petchems demand aces as it digs in for longer trade war
08/05/2019

By John Richardson THE STRENGTH of China’s position in the intensifying trade war is further under...

Read
President Trump’s Tweets increase risk of no trade deal until 2021
06/05/2019

By John Richardson THE PROSPECTS of a trade deal seem to have have faded into the distance as a resu...

Read
Pressure on US builds as PE exports to China tumble and EU considers tariffs
03/05/2019

By John Richardson DONALD TRUMP insisted in early March that he was willing to walk away from a bad ...

Read
China 2019 PE demand grows in double digits as PP struggles
01/05/2019

By John Richardson CHINA’S polyethylene (PE) and polypropylene (PP) markets continue to tell us so...

Read

Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more

Analytics

Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more