Appalachian Region Shows Promise For Petrochemical Production

By Chemical Processing

May 26, 2017

An economic report released by the American Chemistry Council (ACC) shows that the Appalachian region could become a second center of U.S. petrochemical and plastic resin manufacturing, similar to the Gulf Coast. ACC President and CEO Cal Dooley presented the findings at a Capitol Hill press event with lawmakers including Senator Shelley Moore Capito (R-W.Va.), Senator Joe Manchin (D-W.Va.) and Rep. David McKinley (R-W.Va.). 

“The Appalachian region has distinct benefits that could make it a major petrochemical and plastic resin-producing zone,” Dooley says. “Proximity to a world-class supply of raw materials from the Marcellus/Utica and Rogersville shale formations and to the manufacturing markets of the Midwest and East Coast has already led several companies to announce investment projects, and there is potential for a great deal more.” 

ACC’s report presents a hypothetical scenario that includes the development of a storage hub for natural gas liquids (NGLs) and chemicals (e.g., ethylene, propylene), 500-mile pipeline distribution network and associated petrochemical, plastics and potentially other energy infrastructure and manufacturing in a quad-state area consisting of West Virginia, Pennsylvania, Ohio and Kentucky. It uses the IMPLAN model to estimate direct, indirect and payroll-induced job impacts, as well as tax revenue impacts. 

The economic benefits could be substantial. By 2025, the quad-state region could see 100,000 permanent new jobs, including 25,700 new chemical and plastic products manufacturing jobs, 43,000 jobs in supplier industries and 32,000 ‘payroll-induced’ jobs in communities where workers spend their wages, according the report. The new investment could also lead to $2.9 billion in new federal, state and local tax revenue annually.

ACC’s analysis projects a $32.4 billion investment in petrochemicals and derivatives and a $3.4 billion investment in plastic products, put toward the construction of five ethane crackers and two propane dehydrogenation (PDH) facilities. Three of the crackers would produce polyethylene and two would supply downstream petrochemical derivatives. Each PDH facility would contain a polypropylene resin plant. These capital investments are underway and will likely continue through the mid-2020s.

For more information, visit: www.americanchemistry.com/Appalachian-Petrochem-Study/

 

 

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