Natural gas development was sure to be a boon for Pennsylvania.

The sustainability and growth of that boon depend on the continued responsible development of our energy resources and fair taxes and regulations set on the industry.

The Marcellus Shale is the second-largest gas field in the world. According to an IHS Markit Study, in 2015, natural gas from the Marcellus and Utica Shale plays accounted for a quarter of all natural gas produced in the United States and is expected to account for more than 40 percent of the nation's natural gas production by 2030.

The direct jobs are here and growing. On the generation side, the Energy Information Administration expects about 21 GW of natural gas-fired generators will come online in 2018, with 5.2 GW coming from Pennsylvania.

What does this mean for the chemical and petrochemical industries?

Although access to low-cost electricity is always a top priority for business and manufacturers, it’s the ethane and propane component of natural gas that compounds the value, will open doors for diverse investment and grow the industry supply chain here. These high-value natural gas liquids are used in basic petrochemical production and plastics manufacturing, and they are prevalent in the region’s natural gas.

Source: IHS Markit Study, “Prospects to Enhance PA’s Opportunities in Petrochemical Manufacturing”

With 73 percent of the United States and Canada's polyethylene and 67 percent of the polypropylene demand falling within a 700-mile radius of southwestern Pennsylvania, the region is ripe for investment. This is exactly what Shell had the foresight to capitalize on in Beaver County.

Source: IHS Markit Study, “Prospects to Enhance PA’s Opportunities in Petrochemical Manufacturing”

According to Shell, “Locating the facility close to both supply and markets will reduce economic and environmental transportation costs and provide regional plastic manufacturers with more flexibility, shorter supply chains and enhanced supply dependability.”

The IHS Markit forecast shows that, from 2026 to 2030, the expected ethane production from the Marcellus and Utica Shale plays will be enough to support up to four additional world-scale ethane steam crackers in the region, even after meeting the demand from the future Shell Pennsylvania Chemicals cracker.

In other words, the best is yet to come.

With Pennsylvania’s access to abundant natural gas, strong transportation network and skilled labor force, there is opportunity to attract a world-class supply chain centered on the petrochemical and plastics markets that could rival the Gulf Coast.

To back that up, a recent IHS Markit study, “Benefit, Risks, and Estimated Project Cash Flows: Ethylene Project Located in the Shale Crescent USA versus the US Gulf Coast,” determined that a new facility in the Shale Crescent USA region (Pennsylvania, West Virginia, Ohio River Valley) would generate a four-times- higher net-present-value cash flow than a comparable investment in the Gulf Coast.   

Source: Shale Crescent USA

The commonwealth has the opportunity to play the long game and leverage the responsible development of the state’s energy resources to attract diverse and global investment for long-term benefit, putting Pennsylvania in an enviable position.  

Foster Headshot 1

The Pennsylvania Chemical Industry Council (PCIC) has named public affairs veteran Abby Foster as its next president.

Foster was confirmed April 20 by the PCIC executive board to replace Jeff Logan, who is retiring after three years at the helm.

“Pennsylvania’s chemical industry is a significant economic driver for the state, and the council certainly benefited from Jeff’s leadership in laying out a path forward,” Foster said. “I’m motivated to continue his work and explore new opportunities for the public and private sectors to work together to capitalize on the state’s energy resources and to ensure a business climate that attracts and supports investments related to the chemical and petrochemical industries.”

Foster brings more than a decade of experience working with trade groups and industries ranging from health care and energy to human services. She has forged relationships statewide with policymakers, media and industry organizations, and their leadership.

She said she is looking forward to the opportunity to leverage those relationships and her experience to reinforce and increase the value of PCIC in supporting Pennsylvania’s chemical industry.

Pennsylvania's $24 billion chemical industry provides more than 40,000 direct jobs and another 38,000 related jobs, generating more than $410 million in state and local taxes and $933 million in federal taxes on an annual basis.

Logan’s retirement is effective at the end of April, and he is assisting in the transition.

“In the last few years, we have been able to raise the awareness and the importance of PCIC in the Legislature,” Logan said. “Together with Bravo Group’s government relations team, our efforts on behalf of our members led to new legislation that provides a process for Pennsylvania to review and adopt model building codes.”

In addition to PCIC’s legislative wins, Logan said he is proud of the strong relationships the council has developed with the American Chemistry Council and with neighboring states. By speaking at hearings on behalf of local pipeline projects, Logan has made strides to connect the chemical industry with projects that transport its raw materials.

“I am looking forward to seeing Abby infuse her energy and expertise as she takes PCIC to the next level and continues to grow the organization and provide value to our members,” Logan said. “Beyond that, Abby will work to see policies through, which will expand the workforce and the economic benefits of the industry by attracting new investments in the state.”

The Pennsylvania chemical industry continues to innovate. We need look no further than to Pittsburgh, where Braskem America has developed a new polymer allowing frozen foods to be sold in clear containers. On Dec. 7, the company took took home an inaugural Pittsburgh Business Times Innovation Award for the polymer, impact copolymer DP202A.

“Our new DP202A impact copolymer is a thermoplastic resin technology that allows for the toughness of an impact copolymer, clarity similar to a random copolymer, and stiffness of a homopolymer,” said Leslie Bockman, Braskem America’s product technology leader. “Potential end-use applications include a variety of food, beverage and consumer goods packaging containers."

The Pittsburgh Business Times Innovation Award recognizes companies in western Pennsylvania that “made extraordinary advances in their respective fields, challenging conventional thinking,” according to the newspaper. The companies recognized “are the disruptors, creating new products and developing new approaches that challenge traditional approaches.”

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