GLOBAL ETHYLENE CONSUMPTION
300
250
200
150
100
50
PROJECTIONS
0
1978
1984 1990
1996
2008 2002
2014 2020
2026
2038 2032
Source: United States Department of Energy
four hydrogen atoms. Methane is best known as the primary component in natural gas. Beyond that, other hydrocarbons are known as “natural gas liquids” (“NGLs”). They include ethane (two carbon atoms), propane (three carbon atoms), and butane (four carbon atoms). These NGLs often get produced alongside both oil and gas in the energy sector. All these hydrocarbons have one thing in common – a single chemical bond between the carbon atoms. While these single bonds aren’t highly reactive, they can be modified into more useful compounds for everyday use. Ethylene is one such component, and that can be further processed into polyethylene, the world’s most commonly used plastic. Polyethylene is found in everything from water bottles and plastic bags to paint additives and construction materials. And as Dave Witte, a senior vice president at global data service IHS Markit, told online news publication InsideClimate News in February...
These materials are hooked into just about every part of the economy, from housing to electronics to packaging... Today, the world needs six of these [processing] plants to be built every year to keep up with demand growth. In short, experts predict that we’ll soon see a massive boom in global ethylene demand... The above chart from IHS Markit shows historical ethylene consumption, as well as the projected consumption into the 2030s. Notice how it starts to rapidly rise around this year... The companies that will meet this huge new demand for ethylene in the decades ahead will be the ones that can do it the cheapest. That’s because – unlike the latest tech gadgets, cars, or even foods – the end products in this industry, like all commodities, don’t change from one manufacturer to another. Ethylene is the same no matter where it comes from. In this industry, a company’s only competitive edge comes from keeping its production costs as low as possible. That’s where America’s shale boom comes into play...
American Consequences
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