According to Mark Eramo, vice president of global business development -- energy and chemicals for IHS Markit, U.S. shale oil and gas developments that have fueled the recent surge will continue to spur petrochemical investments well into the 2020s.
Gas-based chemistry like ethane, propane and methane-based investments are projected to be particularly healthy, "even up in Canada," Eramo said. "Canada is working hard to try to attract investment in the Alberta region. They're flush with methane and propane."
Eramo also identified other "megatrends" expected to impact the upcoming decade. Regarding the impact of mobility on energy transformation, Eramo observed the "whole idea of being zero-carbon emissions, neutral carbon or even decarbonization of our industry" is a pressing topic of conversation.
"Look at the issue of mobility and how we move people, power and goods around the world [using] automobiles, trucks, trains, planes and ships -- the ability to get better fuel efficiency across that scope and use less hydrocarbons to move the same amount of goods or even more goods," Eramo said at the Rice University Global Engineering and Construction Forum held recently in Houston. "This is leading to a conversation about peak oil demand, and that conversation is leading to a renewed conversation about integration of refinery and petrochemical assets."
This concept is nothing new, Eramo reminded listeners.
"Refinery and petrochemical integration has existed for decades, but now it seems to be at the forefront of a number of conversations, primarily because of what's being built in Asia right now," he said.
"That just leads to this light/heavy balance [of feedstocks] as you look across the olefins growth in terms of how that will change," Eramo continued. "There's not enough low-cost ethane in Saudi Arabia or in North America to supply the global growth of ethylene that we're projecting over this time period."
Using heavier feedstocks is integral to closing that balance, Eramo said, adding that it is necessary for stakeholders in the petrochemical industry to understand what's happening in the value chain and how it affects customers.
"Led by China, APAC (the Asia/Pacific region) is adding more than 50 percent of new capacity, followed by North America and the Middle East, as surplus capacity emerges in many value chains," Eramo said. "The change is happening on a number of different fronts."
Meaningful conversation about the future of petrochemicals must also address the issue of plastic waste, Eramo said.
Referring to an image of a vast landfill site overflowing with plastic bottles and other waste, Eramo observed this challenge can be framed as either "a strong headwind or an opportunity." Either way, he said, the industry has mobilized to take on the challenge.
"This is the issue that the industry has: How do you take collective plastics waste and stop it from going into the environment? And then, what do you do with it?" he asked. "What are the solutions?"
Eramo noted the industry is considering a number of approaches to solving this problem, including stopping the leakage to the environment.
"The Alliance to End Plastic Waste is focused in Asia," he said. "Ten rivers are just pushing plastic waste into the ocean, so they're trying to get that cleaned up."
Ultimately, plastic waste -- not plastics -- is the issue that must be addressed, Eramo emphasized.
"Plastics help us in terms of the current efficiencies around the world, but the plastic waste issue has to be solved," he concluded.