Big Oil Plans to Unleash a Flood of Plastic From US Gulf

(Bloomberg) -- The world’s biggest oil and chemical companies are about to unleash a tidal wave of plastic raw materials by the mid-2020s, tapping cheap shale gas to meet growing demand from makers of everything from toys to plumbing to consumer goods.
Exxon Mobil Corp., Dow Inc., France’s Total SA, South Africa’s Sasol Ltd. and Saudi Basic Industries Corp. have built or announced at least $40 billion in new petrochemical facilities in Texas and Louisiana, according to data compiled by Bloomberg. The most recent is an $8 billion joint venture between Chevron Corp., Phillips 66 and Qatar Petroleum announced this week.
Companies involved | Projected cost | Location
Sasol | $11.8 billion | Louisiana
Exxon, Sabic | $10 billion | Texas
Chevron Phillips, Qatar Petroleum | $8 billion | U.S. Gulf Coast
Dow | $6 billion | Texas, Louisiana
LyondellBasell Industries NV | $2.4 billion | Texas
Exxon | $2 billion | Texas
Total, Nova Chemicals, Borealis | $1.7 billion | Texas
The investments in Gulf of Mexico coastal factories come amid a consumer backlash against plastic bags and straws for their environmental impact. The total amount of oceanic plastic waste is expected to more than double by 2030 if action isn’t taken now, the International Energy Agency said in a report last year.
In the U.S. alone, New York City, Seattle, Oakland and Miami Beach all have either banned straws or have pending proposals to do so. Boston, Chicago, Los Angeles and San Francisco prohibit plastic bags, while several other cities imposed fees for using plastic bags at grocery stores.
Mark Lashier, chief executive officer of the Chevron Phillips Chemical Co. joint venture that’s partnering with Qatar Petroleum, said he’s not worried about straw or bag bans hitting the plastics industry. Some forecasters see plastic demand growing quicker than oil, which is under threat from renewable energy and electric vehicles.
“We certainly take that into account in our supply and demand balances, but the demand in general for plastic materials is growing greater than 4% a year,” he said. “The world is going to need more and more of this as the world population grows.”
To contact the reporters on this story:
Andres Guerra Luz in Houston at aluz8@bloomberg.net;
Rachel Adams-Heard in Houston at radamsheard@bloomberg.net;
Kevin Crowley in Houston at kcrowley1@bloomberg.net
To contact the editors responsible for this story:
Simon Casey at scasey4@bloomberg.net
Carlos Caminada, Joe Carroll
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- API Mulls Embrace of Carbon Pricing
- Tethys Hits Hydrocarbons Onshore Oman
- Oil Exports from Offshore Louisiana Facility Fall to Zero
- Survey Shows Extra Saudi Oil Output Cuts
- CVX Invests in Geothermal Development Co
- Kerry Pitches Hydrogen to Oil and Gas Industry
- Petrobras Awards Contract for Buzios FPSO
- India Calls on OPEC+ to Produce More Crude
- BKR and AKAST Create New Offshore Drilling Co
- Will Oil Price Rise Strain OPEC+ Relations?
- ERCOT Directors Resign
- China Oil Reserves Close to Capacity
- Conoco COO Retires
- Scoop Stack Oil Output Slashed
- Qatar Petroleum Awards Major EPC Deal
- Exxon in $1B+ North Sea Deal
- DOE Awarding up to $46MM for Geothermal Projects
- Cheniere to Provide Emissions Data to LNG Customers
- API Mulls Embrace of Carbon Pricing
- Ecopetrol Chief Defends $4B Utility Deal
- Qatar Petroleum Greenlights $29B LNG Project
- Total Bolsters Renewable Portfolio with Texas Buys
- How Many US GOM Jobs Could Go Under Biden?
- Republican Senators Request Biden Meeting
- How Many US Oil Jobs Were Lost in 2020?
- Nigeria Judge Issues Arrest Warrant for Local Exxon Exec
- Ng Spurns Keystone XL Nafta Challenge
- Texas Governor Addresses Skyrocketing Energy Bills
- Could Biden Order Kill GOM Oil and Gas?
- US Sees Largest Production Disruption Ever