This from "Booming Shale Gas Production Drives Texas Petrochemical Surge," in the Fourth Quarter 2012 edition of the Federal Reserve Bank of Dallas, Southwest Economy:
A highly profitable petrochemical industry has reemerged in Texas from the boom in U.S. shale oil-and-gas exploration, creating an internationally competitive sector than can produce a variety of products including plastics at a lower cost.Most of the world uses naphtha to produce ethylene, which is then used in "polyethylene, polyvinyl chloride, some polyesters and other substances." Naphtha can be found in natural gas liquids and is also a biproduct from petroleum distillation, and thus follows oil prices.
However, you can also use ethane to create ethylene and ethane is one of the natural gas liquids made abundant by hydraulic fracturing.
The article has an interesting table on the investment in ethylene capacity:
These are significant projects. The Chevron plant will make 1.5 million tons of ethylene and the compound will also have two plants to make polyethylene plastic. Total cost will be about $5 billion and
The plants will employ 400 people and the construction project will create 10,000 jobs, the company said.
Dow Chemical Co. (DOW), the world’s largest ethylene producer, plans to spend $4 billion in the U.S. to build a Gulf Coast cracker by 2017, two propylene plants and to reopen an idled Louisiana cracker. Sasol Ltd. (SOL) may spend as much as $4.5 billion to build a cracker and related plants in Louisiana.I know this makes the greens see red. They were all for natural gas until it became abundant. In addition to the billions of investment made in the US for exploration and production and the additional billions in downstream investment and the tens of thousands of construction and manufacturing jobs and lower prices for end-products that use plastic (think everything), fracturing has lowered carbon emissions.
This graph uses data from the EIA's latest Monthly Energy Review and shows the trailing twelve months carbon dioxide emissions (in millions of tons) in the US.
The big drop in 2008 was recession driven and I think shows why many remain skeptical of the green's goals of lowering carbon emissions. That is, it's pretty easy to lower carbon emissions: kill the economy, kill growth. Problem solved. However, if you actually have life to live, that's a not particularly attractive solution to a problem that seems to, no matter what, become more dire, more severe, more catastrophic with each data point. Storms are evidence of carbon-based climate change. Lack of storms are evidence of carbon-based climate change. Natural gas is a solution. Natural gas is the problem. We need a strong central government, the bigger the better, the more global the better, to command and control the use of a fuel that has resulted in a better standard of living for billions of people for over 100 years.
And here's the thing, carbon emissions are coming down with very little being done from a top-down, government directed mandate. I know you hate to admit it, but the free market did this pretty much all on its own. Natural gas, which has about half the carbon emissions per BTU as coal is displacing coal in the electric generation market, and is doing that because hydraulic fracturing has brought about massive reserves of natural gas, resulting in lower prices relative to coal. The transition isn't over because we are in the very early stages of natural gas displacing diesel, then gasoline, in internal combustion engines.