The growth of natural gas production in the United States has set in motion an investment boom in the domestic petrochemicals sector that will result in American and Arabian Gulf producers competing for market share in Europe.
The shale gas revolution, which added to the supply with new production techniques, has driven down the price of natural gas, creating much better market conditions for chemical companies.
“Not very long ago, a number of clients said they wouldn’t invest in the US anymore,” said Jose Bustamante, a senior vice president at Fluor, an engineering and construction firm with a broad portfolio in the energy and downstream sectors. “Now, there are a number of opportunities coming up. I think we are getting into a new boom in investment in the US.”
International oil companies such as Shell are also planning to expand their US petrochemicals business, with Shell planning a cracker feeding off the massive Marcellus shale gasfield in the Appalachian mountains.
“US natural gas is abundant and affordable,” Marvin Odum, the president of Shell, said last year.
The market benefits simultaneously from the availability of gas, the prime feedstock for petrochemicals alongside crude oil, and the proximity to end users.
Experts predict that the shale revolution will not only turn the US into a net exporter of gas, but also lead to increasing exports of petrochemicals. This will lead to US and Gulf producers competing for market share in Europe, which is within reach of North America and the Middle East.