DATE: November 15, 2019
SNIP: Natural gas is mostly used for heating homes or fueling power plants. But when it comes out of the ground it contains another key ingredient — ethane, a building block of plastics — that is now fueling another booming industry.
America is producing so much ethane that more than 300 new petrochemical and plastics plants are either planned or are under construction around the U.S.
President Trump has touted the economic benefits of this, recently telling workers at a Shell ethane plant in Pennsylvania that “we are reclaiming our noble heritage as a nation of builders.”
But there’s more ethane than existing U.S. plants can use, so in short order the U.S. has also become the world’s leading exporter of ethane. That’s feeding growing plastics industries in India and China, as well as Europe and those exports are expected to keep growing.
Plastics and petrochemicals are increasingly important to the oil and gas industry. They’re expected to account for more than a third of growth in world oil demand by 2030, and half of all growth by 2050, according to the International Energy Agency. This worries environmentalists, who point out that the plastics industry accounts for about 4% of all carbon emissions, and that number is expected to increase.
Much of the growth in plastics will be in Asia, where millions of people will be moving into the middle class in the next few decades.