Monday, December 19, 2011


Shale's Bounty Goes Beyond Oil and Gas (WSJ-sub req):

HOUSTON—The U.S. shale-oil and natural-gas boom has cracked open another lucrative market—gas liquids used to make plastics.

The same drilling technologies that have unlocked vast amounts of crude and natural gas from previously unproductive shale formations across the U.S. also are reaping large stores of ethane, propane and butane, known as natural-gas liquids.

This growing bounty has resuscitated the U.S. petrochemical industry, which just a few years ago was being strangled by the high costs of the raw materials.

Processing ethane into chemicals is 50% cheaper than using crude oil-derived naptha and its availability has made U.S. petrochemical companies the envy of overseas competitors. It also brings the prospect of lower prices for auto parts, Styrofoam and other products.

Lower costs for US petrochemicals companies means more investment, more production, and of course more jobs. The shale energy boom could be the best thing that has happened to the US economy in years.