Abundant Feedstock Supply from the Shale Reserves to Revive the US Petrochemical Industry, US Bakken Oil Production Continues to Increase

FARMINGTON, Conn., Dec. 13, 2012 /PRNewswire-iReach/ -- One of the major beneficiaries of the shale revolution is the US petrochemicals industry, which was losing its competitiveness in the wake of increasing feedstock prices and waning domestic demand. As natural gas production revived in the later part of the last decade, the production of Natural Gas Liquids (NGLs), a mixture of heavier hydrocarbons such as ethane, propane, butane and isobutane found in the natural gas, also increased significantly. Two major components of NGL, ethane and propane, are used as petrochemical feedstocks. While ethane is almost exclusively used in the petrochemical production, propane is mostly used as a fuel for home heating appliances and is sometimes used in petrochemical production.

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Many petrochemicals companies have entered the US petrochemicals industry due to the growth of NGL production and the resultant decline in ethane prices. These companies are betting on the US' increasing competitiveness in the global petrochemicals industry and are setting up crackers to produce cost-advantaged ethylene. Ethylene capacity in the US is expected to increase by 34% over next five years after having remained stagnant for the most part of the previous decade, boosted by multinational petrochemical companies setting up new ethane crackers in the US. These include The Dow Chemical Company, Chevron Phillips Corporation, ExxonMobil Corporation, Royal Dutch Shell and Sasol Limited, all of which are planning to build ethane crackers with a capacity of more than one Million Metric tons per annum (MMtpa).

Petrochemical Industry in the US

Drillers in the US are currently focusing on liquid-rich shale plays such as Eagle Ford, Barnett, Bakken and Marcellus, which, in addition to natural gas, provide valuable Natural Gas Liquids (NGL, a mixture of hydrocarbon gases such as ethane, propane, butane and isobutane), as by-product. As a result, NGL production in the US increased from 620 Million Barrels (MMbbl) in 2005 to 809 MMbbl in 2011. Ethane production has also received a boost from high NGL production and has increased from 236 MMbbl in 2005 to 338 MMbbl in 2011. It is expected to increase further as drilling in the liquid-rich shale areas continues into the future.

Ethane supplies in the US are witnessing a similar trend to natural gas. Prices have plummeted in the last year because production has risen above demand, which has come as good news to petrochemicals producers as their profits have increased. The US petrochemicals industry is dominated by ethane feedstock, and so profit margins have also increased substantially due to the lower cost of production. Ethane prices are expected to remain low as drillers continue to focus on the liquid-rich shale plays. The following figure depicts the substantial increase in ethane production between 2008 and 2012.

The report will enhance your decision-making capability by allowing you to: Understand the ethane supply scenario in the US; Develop market strategies with the help of specific insights into feedstock supply in the US; Identify opportunities in the US petrochemicals industry with the help of specific insights into future investments in the US; Increase future revenue and profitability with the help of insights into future opportunities and critical success factors in the US petrochemicals industry; and Understand the current and likely future competitive scenario

An Executive Summary for this report and free sample pages from the full document are available at http://www.giiresearch.com/report/gd256542-petrochemical-industry-us-abundant-feedstock.html

Bakken Shale in the US, 2012 - Oil and Gas Shale Market Analysis and Forecasts to 2020

Bakken shale has developed into one of the most promising oil and gas producing shales in the US. This shale primarily produces oil, and total production from the Bakken formation increased at a growth rate of 45% in 2010-2011. The shale's total production grew at a Compound Annual Growth Rate (CAGR) of 50.4% for 2004-2011. Oil production in the Bakken shale increased from approximately 8.4 million barrels (mmbbl) in 2004 to 138.6mmbbl in 2011, at a CAGR of 49.3%. A large part of this increase came from the North Dakota Bakken shale formation (NDIC, 2011a). The figure below provides historical and forecast production data for the US Bakken shale play for the 2004-2020 period.

This report provides insight into existing and potential exploration and development activities in the Bakken shale play. The report also provides details about the business plans of various companies to increase their production, reserves and undeveloped land base in the US region of the shale.

An Executive Summary for this report and free sample pages from the full document are available at http://www.giiresearch.com/report/gd256575-bakken-shale-us-oil-gas-shale-market-analysis.html

Media Contact: Jeremy Palaia Global Information Inc, 8606748796, press@gii.co.jp

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SOURCE Global Information, Inc.



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