US shale gas boom to be key focus at 8th GPCA’s Annual Forum | US shale gas boom to be key focus at 8th GPCA’s Annual Forum -
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US shale gas boom to be key focus at 8th GPCA’s Annual Forum

: Sunday, November 17 - 2013 @ 08:37

According to the US Energy Information Administration (EIA), shale gas is available on all continents in large amounts and much more widely distributed than conventional oil and gas resources.

Global technically recoverable shale gas resources are estimated at 6,240 trillion standard cubic feet—of which around 8% are in the USA, 10% in Europe and 20% in China. Reserves are likely to significantly increase in the near future as more exploration data becomes available.

The US shale gas boom has revived the US chemical industry, which is becoming increasingly competitive globally, with access to guaranteed supplies of gas and cost-efficient processes. The question now is: will there also be a shale gas boom in China and Europe? And would that undermine the global competitiveness of the GCC chemicals industry?

According to the ‘Shale Game: Impact of the global shale development on the GCC’, a joint report recently issued by the GPCA and Stratley, the development of shale reserves in the GCC is currently in its infancy. In Saudi Arabia, the largest identified deposit of shale gas is located in Rub al Khali, close to the giant Ghawar oil field.

Saudi Aramco is leading exploration activities in the Kingdom, with seven shale gas test wells set to be drilled by the end of this year. Despite these developments, challenges such as limited access to water for extraction purposes, are likely to delay large-scale development of these resources to 2020.

The shale gas phenomenon will be a key focus at the 8th GPCA Annual Forum, to be held at the Madinat Jumeriah in Dubai from November 19-21. Over 16 senior industry leaders from global and regional companies will address six forum sessions, with two seminars highlighting the trends, opportunities and challenges in the development of unconventional hydrocarbons resources.

According to the GPCA-Stratley report, the shale gas revolution in North America will drive investments in chemical plants producing fertilizers and ethylene derivatives like polyethylene. Polyethylene—a plastic product used to make food packaging and plastic bags—will be a major trade commodity for the United States, with exports expected to double by 2020.

The availability of large volumes of hydrocarbons in the United States will drive cost competitiveness amongst domestic petrochemical companies, and also increase exports in plastics to Europe and Asia, two key markets for GCC petrochemical producers.

GCC polyethylene manufacturers could, therefore, experience a significant drop in revenues. In 2012, the Gulf states exported 16.4 million tons of polyethylene, roughly 26% of the global export market. The US, in comparison, exported 18.6 million tons of polyethylene in the same period.

The medium term outlook is positive: GCC polyethylene exports will reach 20.3 million tons by 2016. But GCC producers need to adapt to changing market conditions now in order to realize continued growth. Further innovation in products and processes will be key.

“The ‘Shale Game: Impact of the global shale development on the GCC’ report will be released at the GPCA Annual Forum next week in Dubai. Now in its eighth year, the plenary address will be delivered by HRH Prince Abdulaziz Bin Salaman Al Saud, Saudi Arabia’s Deputy Minister of Petroleum and Minerals.”

The GPCA Annual Forum will be held at the Madinat Jumeirah, Dubai from November 19-21.

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Sunday, November 17- 2013 @ 8:37 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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