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US chemical activity, natural gas exports, and resin production surge; Total JV plans $1B TX plant expansion
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US chemical activity sees “slow and steady” growth—ACC
The American Chemistry Council’s (ACC) Chemical Activity Barometer (CAB) had a slight gain month on month in September, the ACC said on Tuesday.
The CAB reading of 122.58 on a three-month moving average (3MMA) basis continued a trend described by the ACC as “slow but steady growth” for 2018. The barometer is up 0.1% from August, and 4.0% year-over-year.
American Chemistry Council
Of the CAB’s primary components (production, equity prices, product prices, inventories), all showed gains in September, including strong gains in equity prices and product/input prices.
The diffusion index remained at 71%. This index marks the number of positive contributors relative to the total number of indicators monitored.
The Chemical Activity Barometer is a leading economic indicator derived from a composite index of chemical industry activity.
The chemical industry has been found to consistently lead the U.S. economy’s business cycle given its early position in the supply chain, and this barometer can be used to determine turning points and likely trends in the wider economy, the ACC said.
The CAB comprises indicators relating to the production of chlorine and other alkalis, pigments, plastic resins and other selected basic industrial chemicals; chemical company stock data; hours worked in chemicals; publicly sourced, chemical price information; end-use (or customer) industry sales-to-inventories; and several broader leading economic measures (building permits and new orders).
Total JV plans $1B TX plant expansion
French energy company Total and its partners, Borealis and Nova Chemicals, announced a final investment decision (FID) on its planned $1 billion expansion to Total's Bayport polymer plant in Texas.
The joint venture project, which will more than double the amount of the Bayport site's polyethylene production to around 1.1 million tonnes/year, should be finished in 2021.
The Bayport unit engineering, procurement and construction (EPC) has been awarded to McDermott.
The Bayport project is a part of the company’s $3 billion investment program that began in 2017 with a $1.7 billion investment to build an ethane steam cracker at its Port Arthur refining complex in Texas.
The cracker will process ethane and will supply Bayport polyethylene units. Production is expected to start in 2021.
US net natural gas exports more than double 2017 average
U.S. net natural gas exports in the first half of 2018 were more than double the 2017 average, according to the U.S. Energy Information Administration (EIA).
From January through June 2018, net natural gas exports from the U.S. averaged 0.87 billion cubic feet per day (Bcf/d), more than double the average daily net exports during all of 2017 (0.34 Bcf/d).
The U.S., which became a net natural gas exporter on an annual basis in 2017 for the first time in almost 60 years, has continued to export more natural gas than it imports for five of the first six months in 2018.
Energy Information Administration
U.S. natural gas exports have increased primarily with the addition of new liquefied natural gas (LNG) export facilities in the Lower 48 states. U.S. exports of LNG through the first half of 2018 rose 58% compared with the same period in 2017, averaging 2.72 Bcf/d.
Total U.S. LNG export capacity reached 3.6 Bcf/d in March 2018. The LNG facility at Sabine Pass in Louisiana has an export capacity of 2.8 Bcf/d, which includes the recently completed Train 4. Cove Point LNG in Maryland, which has an export capacity of 0.8 Bcf/d, delivered its first cargo in March 2018 and entered full commercial service in April. In the first two full months of operation after the capacity additions (May and June), Cove Point exported an average of 0.57 Bcf/d (76%) of its nameplate capacity.
Another four LNG facilities are under construction and planned to enter into service by the end of 2019, ultimately increasing U.S. LNG export capacity to 9.6 Bcf/d.
US production of resins climbs 20% year on year
U.S. production of major plastic resins increased by nearly 20% in August 2018 as compared to the same month one year ago, the American Chemistry Council (ACC) said.
Image: High Density Polyethylene. Source: AMB Enterprise Karachi
Production totaled 7.6 billion pounds during August 2018. Year-to-date production is 57.6 billion pounds, a 7.9% increase as compared to the same period in 2017.
Sales and captive (internal) use of major plastic resins totaled 7.7 billion pounds during August 2018, an increase of 15.3% from the same month one year earlier.
Year-to-date sales and captive use were 57.3 billion pounds, a 7.6% increase as compared to the same period in 2017.