Strong global demand and competitive U.S. energy resources are reasons for optimism in the petrochemical sector, according to Mark Lashier, executive vice president of Chevron Phillips Chemical Co. LP. Lashier outlined the company’s growth strategy amid operating within the challenge and uncertainty of the current energy environment at IHS CERAWeek, Feb.22-26, in Houston, Texas.
“We have an enthusiastic long-term view for petrochemicals thanks to a one-two combination of strong global demand and competitive feedstocks from the U.S. shale resource boom,” said Lashier during a panel discussion. By 2030, the global middle class is predicted to grow to nearly 5 billion people from under 2 billion today, according to the United Nations.
“The economic growth that accompanies this rise of the middle class will fuel demand for plastic consumer products, meaning billions of people will have access to better quality-of-life products such as flexible packaging to store and transport food and beverages, enabling modern living,” Lashier added.
To begin accommodating the demand, Chevron Phillips Chemical is focused on the mid-2017 start-up of its $6 billion U.S. Gulf Coast Petrochemicals Project, which includes a 1.5 million metric-ton-per-year ethane cracker that will produce ethylene and two world-scale polyethylene units that will each produce 500,000 metric tons of resin every year along the Texas Gulf Coast.
Ethylene derivatives are a key ingredient in plastics manufacturing, particularly for polyethylene, one of the world’s most common types of plastic. Polyethylene is found in film, packaging and containers, from bottles to pails. The new polyethylene units will allow Chevron Phillips Chemical to become a bigger player in merchandise bags while expanding its capability in flexible packaging and high-performance pressure pipe applications.
In addition to being focused on starting up its new manufacturing assets next year, the company is concentrating on industry-wide efforts such as building a solid pipeline of skilled talent to ensure the future success of the industry and urging investment in North American infrastructure to ensure supply chains remain competitive.
“While we may need to take a deep breath as the global economy settles, we are convinced that we are on the verge of a growth curve,” Lashier said. “Demand for the chemicals and plastics business is strong, compelling us to continue to search the globe for the next major investment.”
IHS CERAWeek is a premier annual international gathering of energy industry leaders, experts, government officials and policymakers, leaders from the technology, financial and industrial communities, as well as energy technology innovators. This year marks the 35th anniversary of the event.