Big Oil’s Plan B is already in the pipeline: More plastic

As public concern about plastic pollution rises, consumers are reaching for canvas bags, metal straws, and reusable water bottles. But while individuals fret over images of oceanic garbage gyres, the fossil fuel and petrochemical industries are pouring billions of dollars into new plants intended to make millions more tons of plastic than they now pump out.

Companies like ExxonMobil, Shell, and Saudi Aramco are ramping up output of plastic — which is made from oil and gas, and their byproducts — to hedge against the possibility that a serious global response to climate change might reduce demand for their fuels, analysts say. Petrochemicals, the category that includes plastic, now account for 14 percent of oil use, and are expected to drive half of oil demand growth between now and 2050, the International Energy Agency says. The World Economic Forum predicts plastic production will double in the next 20 years.

“In the context of a world trying to shift off of fossil fuels as an energy source, this is where [oil and gas companies] see the growth,” said Steven Feit, a staff attorney at the Center for International Environmental Law, an advocacy group.

And because the American fracking boom is unearthing, along with natural gas, large amounts of the plastic feedstock ethane, the United States is a big growth area for plastic production. With natural gas prices low, many fracking operations are losing money, so producers have been eager to find a use for the ethane they get as a byproduct of drilling.

“They’re looking for a way to monetize it,” Feit said. “You can think of plastic as a kind of subsidy for fracking.”

America’s petrochemical hub has historically been the Gulf Coast of Texas and Louisiana, with a stretch along the lower Mississippi River dubbed “Cancer Alley” because of the impact of toxic emissions. Producers are expanding their footprint there with a slew of new projects, and proposals for more. They are also seeking to create a new plastics corridor in Ohio, Pennsylvania, and West Virginia, where fracking wells are rich in ethane.

Shell is building a $6 billion ethane cracking plant — a facility that turns ethane into ethylene, a building block for many kinds of plastic — in Monaca, Pennsylvania, 25 miles northwest of Pittsburgh. It is expected to produce up to 1.6 million tons of plastic annually after it opens in the early 2020s. It’s just the highest profile piece of what the industry hails as a “renaissance in U.S. plastics manufacturing,” whose output goes not only into packaging and single-use items such as cutlery, bottles, and bags, but also longer-lasting uses like construction materials and parts for cars and airplanes.

Since 2010, companies have invested more than $200 billion in 333 plastic and other chemical projects in the U.S., including expansions of existing facilities, new plants, and associated infrastructure such as pipelines, says the American Chemistry Council, an industry body. While some are already running or under construction, other projects await regulators’ approval.

“That’s why 2020 is so crucial. There are a lot of these facilities that are in the permitting process. We’re pretty close to it all being too late,” said Judith Enck, founder of Beyond Plastics and a former regional director for the U.S. Environmental Protection Agency. “If even a quarter of these ethane cracking facilities are built, it’s locking us into a plastic future that is going to be hard to recover from.”

Global emissions linked to plastic — now just under 900 million tons of carbon dioxide-equivalent annually — could by 2030 reach 1.3 billion tons, as much as almost 300 coal-fired power plants, the Center for International Environmental Law found. If output grows as planned, plastic would use up between 10 and 13 percent of the carbon emissions allowable if warming is to stay below 1.5 degrees Celsius, the Center reported. MORE

One thought on “Big Oil’s Plan B is already in the pipeline: More plastic”

  1. This is so amazing. It reminds me of the collapse of the American steel industry in the 1980s: these guys just cannot conceive of a world in which they aren’t making money hand over fist with the rest of the world banging on their door for more more more. The delusion is extraordinary. I recently had a back-and-forth with MidAmerican Energy’s head PR guy, who’d been defending moves to throttle solar, and he’s drinking their kool-aid, too — outraged that anyone might suggest that what he’s doing is the least bit unethical.

    But if the analogy is good then Mark Carney has a real point. It was less than a decade between the time that the American steel firms felt the first tremors and the time that the mills started shutting down. That’s not a long time in investment-portfolio terms, and there are serious consequences for ordinary people all over. Pension and retirement funds, municipal investment portfolios, all of these are petroleum-heavy. And you can see how desperate the situation is. The US Senate’s tied up in an impeachment trial that’s motivated by Russian desperation to hang onto their one functioning large industry. I haven’t even heard anyone talking about the geopolitics of oil price collapse in the Middle East and Persia.

    But these people are so out of touch it’s unreal. I genuinely don’t think it occurred to them that both fossil fuel and plastic use could dip. And I’m a little surprised, because I’d have thought they’d look to Option 3: pharmaceutical, fertilizing, and other organic-chemistry markets. Hydrocarbons make absolutely beautiful feedstocks for an awful lot of chemistry that the world now depends on for food and health. Maybe they’ve gotten too giant and greedy for that to look attractive.


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