Material Insights: Shale gas signals renaissance for chemicals and plastics

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In today's Material Insights video, we have a report from the IHS World Petrochemical conference in Houston, plus news on a major plastics recycling closing its doors.

Last week, Plastics News senior reporter Frank Esposito was one of the more than 1,000 attendees at the IHS World Petrochemical Conference in Houston. The event featured outlooks for materials and markets throughout the petrochemical chain, including plastics.

At the event, Dow Chemical executive Jim Fitterling said the investment surge created by North American shale gas could be much bigger than the market expects it to be.

Fitterling cited four waves of investment, including one in which new plastics processing capacity could be added in the region. He estimated that there are at least 120 energy-related expansions currently announced for the United States, with more than $100 billion being invested.

At the conference, Esposito spoke with polyethylene analyst Nick Vafiaidis about the impact of new polyethylene for plastics processors.

Progress on West Virginia cracker

Elsewhere this week, the prospect of a new plastics and petrochemicals plant in West Virginia moved closer to reality when Brazilian firm Odebrecht secured a deal to supply half of the ethane volume needed for the project.

Odebrecht will receive that material from Antero Resources for its planned site in Parkersburg. The availability of natural gas-based ethane in the region has prompted interest from several firms, although Odebrecht has been the most active to date.

Recycler closes shop

And finally, last week also brought the unfortunate news of the closing of one of North America’s largest plastic recyclers. Maine Plastics closed the doors at its two remaining plants in Zion, Ill., and Kalamazoo, Mich.

 An e-mail response from CEO David Kaplan said that the firm can no longer take delivery of customers’ recyclables because of actions taken by its bank.

 Market sources said that Maine Plastics may have been affected by higher shipping costs in 2013 and by its decision to add six new locations in a six-year period. Maine Plastics was founded in the early 1980s and the firm processed more than 160 million pound of mostly post-industrial material in 2013.