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U.S. manufacturing sector prospers with natural gas boom

Rising natural gas production has lured more manufacturers back to the United States with the promise of cheaper electricity and feedstock.
BY JAY F. MARKS jmarks@opubco.com Modified: September 20, 2012 at 9:29 pm •  Published: September 21, 2012
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Chemical companies in the U.S. can “crack” ethane to turn it into ethylene rather than relying on more expensive naphtha. Swanson said that shows the “fundamental competitiveness” this country enjoys in that market.

Swanson said lower prices for natural gas liquids have led to a “flood” of announcements in the chemical industry, with companies planning to add 11 billion tons of new ethylene production capacity.

Most of those projects are located along the Gulf of Mexico because of pre-existing infrastructure investments there, but Shell has announced plans to build an ethane cracker in western Pennsylvania.

Alan Walker, secretary of the Pennsylvania Department of Community and Economic Development, said that was exciting news for the state, with the potential for additional facilities in the region because of its abundant natural gas resources.

“If we use it right and manage it right, we're looking at at least a 100-year supply here in Pennsylvania,” Walker said.

Natural gas may be more commonly recognized as a versatile fuel that can be used for electricity, heating and transportation. It also can be used directly by manufacturers, Walker said.

“It can be the dawn of a new industrial revolution, but only if we allow the industry to develop,” he said.

Swanson said rising natural gas production also offers lucrative opportunities for companies that use butadiene or specialize in gas-to-liquids processes that turn natural gas into gasoline or diesel fuel.