06242018Sun
Last updateFri, 22 Jun 2018 2pm

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U.S. Specialty Chemicals Markets Continue to Gain

The American Chemistry Council (ACC) reported that U.S. specialty chemicals market volumes continued to gain during the second quarter, increasing 0.5% in May after an upwardly revised 1% gain in April and a 0.4% gain in March. All changes in the data are reported on a three-month moving average (3MMA) basis. Of the twenty-eight specialty chemical segments ACC monitors, fifteen expanded in May, ten markets experienced decline and three featured no change. During May, large market volume gains (1% and over) occurred in oilfield chemicals and plastics compounding.

The overall specialty chemicals volume index was up 5.1% on a year-over-year (Y/Y) 3MMA basis. The index stood at 112.9% of its average 2012 levels. This is equivalent to 7.78 billion pounds. On a Y/Y basis, there were gains among twenty-three market and functional specialty chemical segments. Compared to last year, volumes were down in four segments.


Global LNG Trade Growing, Led by Australia and the U.S.

Global trade in liquefied natural gas (LNG) reached 38.2 billion cubic feet per day (Bcf/d) in 2017, a 10% (3.5 Bcf/d) increase from 2016 and the largest annual volume increase since 2010, according to the Annual Report on LNG trade by the International Association of Liquefied Natural Gas Importers. In 2017, there were 19 LNG exporting countries and 40 LNG importing countries. Australia and the U.S. were among the countries with the largest increases (2.7 Bcf/d combined) in 2017 LNG exports.

Besides Australia and the U.S., several other countries also increased LNG exports in 2017. Asian countries led the growth in global LNG imports, accounting for 74% (2.6 Bcf/d) of the increase in 2017. Japan remains the largest LNG importer, importing 11.0 Bcf/d in 2017. China had the largest growth in LNG imports globally (1.5 Bcf/d) and became the world’s second-largest LNG importer in 2017, surpassing South Korea. 

U.S. Natural Gas Production Could Grow 60% Over Next 20 Years

A decade since the start of a shale gas revolution that unlocked new supplies and resulted in a “wholesale turnaround” in U.S. production, the overall size of recoverable gas reserves continues to increase and the pace of production growth is only accelerating, a new report by IHS Markit says.

The most dramatic effect has been on the U.S. electric power industry, the report says. Where coal and nuclear had previously dominated the growth in share of U.S. electric power generation, natural gas has become a “backbone of electric generation” and regularly competes with coal for the largest share of total electric generation. By 2040, IHS Markit expects natural gas’ share to grow from almost one-third to nearly half of all electricity generated in the United States. 

Phillips 66 Plans $1.5 Billion Expansion in Texas

Phillips 66 is proceeding with an expansion of the company’s Sweeny Hub. This project includes the construction of two 150,000 barrel-per-day (BPD) natural gas liquids (NGL) fractionators in Old Ocean, TX, additional NGL storage capacity, and associated pipeline infrastructure. The project is expected to cost up to $1.5 billion and begin commercial operations in late 2020.

Upon completion of the expansion, the Sweeny Hub will have 400,000 BPD of NGL fractionation capacity and access to 15 million barrels of total storage capacity. 

Permian Oil Production to More than Double, Exceed Expectations

Oil production in the Permian Basin, already a major force in global supply growth, will rise nearly 3 million barrels a day (mbd) by 2023—a level of growth exceeding most recent estimates, says IHS Markit. What the report describes as a “stunning” level of growth will comprise more than 60% of net global production growth during that timeframe. T

otal oil production in the Permian will be 5.4 mbd in 2023, more than the total production of any OPEC country other than Saudi Arabia. Nearly 41,000 new wells and $308 billion in upstream spending between 2018-2023 will drive that growth. Production of both natural gas and natural gas liquids (NGLs) in the Permian are also expected to double during this period, reaching 15 billion cubic feet a day and 1.7 mbd, respectively. 

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