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 The drama continues in the Asian butadiene market. Bids this...

Learn more
NEXT POST

China Auto Sales Point To Long-term Shift

12/03/2012

By John Richardson The impact of Chinese government policy adjustments on petroc...

Learn more
More posts
Coronavirus: Global polypropylene demand in 2020 could fall by 2.6m tonnes over last year
17/02/2020

By John Richardson SOME GOOD news might be that official Chinese state media announced that the numb...

Read
Coronavirus threatens 2.9m tonnes of China PP demand as uncertainties increase
14/02/2020

By John Richardson THE RUMOURS travelled around my contacts, and I am sure many of your contacts, fo...

Read
More than 3m tonnes of Chinese polyethylene demand at risk from coronavirus
08/02/2020

    By John Richardson THE GOOD news is that medical experts believe the novel coronavirus...

Read
Coronavirus: Global polyester chain faces major production cuts, shortages and cost increases
07/02/2020

By John Richardson A GREAT example of the extent to which global supply chains are exposed to China ...

Read
Coronavirus: Global polyolefins cutbacks seem inevitable on major China demand loss
05/02/2020

We all hope that the coronavirus outbreak will soon be brought under control, that’s the main ...

Read
Why coronavirus will be a much bigger deal for petrochemicals than SARS
02/02/2020

By John Richardson THE WORLD was very different in 2003 when SARS struck. Back then, China accounted...

Read
China 2020 polyethylene demand 4.1m tonnes lower on single-use plastics ban and coronavirus
27/01/2020

By John Richardson CHINA was supposed to be the one polyethylene (PE) market we could all depend on ...

Read
China single-use plastic bans: Polyethylene imports 68m tonnes lower in 2020-2030
24/01/2020

By John Richardson THE good news from a “business as usual” perspective is that China’...

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