ExxonMobil sees North America's chemical feedstock and energy costs remaining among the lowest in the world, ExxonMobil Chemical senior vice president Matt Aguiar said today in a speech at the IHS World Petrochemical Conference.

“We expect North America to remain competitive with other regions as a chemical producer," Aguiar said. "And we see continued growth in jobs, growth in production and growth in US chemical exports."

Aguiar explained that the petrochemical industry is the world's largest industrial energy user, and the only one that uses energy for both fuel andfeedstock. 

“Today, the production of chemicals accounts for about 15% of global oil demand and 10% of natural gas demand – and includes more than 45% of the demand for natural gas liquids,” he said.

He pointed out that US output of ethane, propane and other natural gas liquids has risen by more than 65% since 2008. 

“American chemical producers will continue to have an abundant long-term supply of ethane and other natural gas liquids for feedstock,” he said.

Rising production of natural gas liquids, or NGLs, is driving a global shift toward NGLs as a chemical feedstock, Aguiar said. 

“Naphtha remains the number one steam-cracker feedstock, accounting for more than 50% of global demand," he said. "Ethane and other NGLs are second, at about 30%. 

"However, ExxonMobil sees demand for NGL feedstock rising by about 125% through 2040, compared to 70% for naphtha," he added. "As a result, we expect NGLs to surpass naphtha as the top feedstock in the chemical sector by around 2025.”

The American Chemistry Council (ACC) projects that US exports of plastics and other chemical products will double from 2014 to 2030, Aguiar pointed out. 

“Export capacity will increase as planned US chemical expansions move forward, including ExxonMobil's project at Baytown, Texas,” he said.

Construction at ExxonMobil’s project has been underway for 10 months, Aguiar said.

“During this time, we have had about 4,000 workers on site representing a range of disciplines, including carpenters, electricians, welders, and ironworkers,” he said. “Foundation and underground work will be completed over the next few months, followed by installation of steel structures and equipment, and then piping, electrical and instrumentation.”

When the Baytown expansion is completed in 2017, ExxonMobil will have added 1.5 million tpy of steam-cracker capacity. The ethylene feedstock will be used for downstream chemical processing, including processing at two new 650,000-tpy high-performance polyethylene (HDPE) lines at the company’s Mont Belvieu plastics plant.

The expansion is creating a total of 10,000 construction jobs and is projected to add 4,000 new, permanent local jobs, including 350 positions at the ExxonMobil plants.