Shale Gas, Competitiveness, & New U.S. Chemical Investment: ACC Study

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Shale Gas, Competitiveness, & New U.S. Chemical Investment: ACC Study

  1. 1. May 2013SHALE GAS, COMPETITIVENESS,AND NEW U.S. CHEMICALINVESTMENT: AN ANALYSISBASED ON ANNOUNCEDPROJECTSThe  full  ACC  report  is  available  http://chemistrytoenergy.com/shale-­‐study.    
  2. 2. Shale Boom Driving NewU.S. InvestmentNorthAmericanCompetitiveAdvantageSustainedthrough2020Data provided withpermission fromIHS Global InsightAffordable, competitivelypriced natural gas is drivingsignificant new capitalinvestment in the USmanufacturing sectorLong-‐term, sustainedopportunity in feedstocksupply and cost51% of new, publicly-‐announced chemicalindustry investment is fromfirms based outside the US
  3. 3. U.S. Shale Gas Chemical InvestmentManufacturingrenaissance due toincreased access tonatural gas from shaleDownstream partners aremore competitive thaneverNearly 100 projectsannounced as of March 2013$72 billion in potentialchemical industry capitalinvestments$67 billion in additionaloutput by 2020
  4. 4. US Chemical Industry GrowthOutpaces Western Europe607080901001101201301990 1995 2000 2005 2010 2015 2020By  2020,  US  chemical  output  is  21%-­‐23%  higher  than  Western  Europe.  Western  Europe  Chemicals  excl.  Pharmaceuticals  -­‐  Volume  Index  of  Production  (2007=100)    Sources:  Eurostat,  FRB,  ACC  analysis  U.S.  
  5. 5. New ACC Study: US Chemical IndustryOutput from Shale-‐Related Investments$0$10$20$30$40$50$60$70$802010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020Billions  of  2012  Dollars  By  2020,  additional  output  from  shale-­‐related  chemical  investments  generates  $66.8  billion  in  additional  chemical  industry  shipments.      This  is  an  ongoing,  permanent  upward  shift  in  the  level  of  shipments.  
  6. 6.    During  Investment  Phase  2010-­‐2020*  (Temporary)  From  Higher  Chemical  Industry  Output    in  2020  (Permanent)      Total  Jobs  Average  Jobs  Added  Per  Year  Payroll    ($  Billion)  Output  ($  Billion)   Total  Jobs  Payroll    ($  Billion)  Output  ($  Billion)  Direct            485,054     44,096   $30.7     $71.7     46,359             $4.9     $66.8    Indirect        258,039     23,458   $16.4     $55.9          264,111     $18.9     $100.4    Induced        442,233     40,233   $20.8     $66.2          226,272     $10.6     $33.9      Total        1,185,326     107,757   $67.9     $193.9     536,741           $34.4     $201.1    NewACC Study: Economic Contributions fromAnnounced Chemical Industry Investments in U.S.*Because the investment occurs over a multi-year period, investment phase jobs should be interpreted as work-yearjobs. This is done to avoid double-counting the same job in multiple years.
  7. 7. $14Bin NEW, PERMANENTfederal, state, and localtax revenue fromincreased chemicalindustry output(by 2020)$20Bin NEW federal, state, andlocal tax revenue duringinvestment phase(2010-‐2020)New ACC Study: TaxRevenue Benefits
  8. 8. Access & Infrastructure: Allow access to natural gas reserves ongovernment and private lands. Ensure reliable infrastructure totransport suppliesPermitting: Timely approval of new construction permits forprojects and investmentsState Regulations: Implement responsible state-‐based regulationsthat avoid undue restrictions on natural gas suppliesTax Treatment: Minimize cost and reduce complexity forbusinesses. Maintain accelerated depreciation in tax policyPolicies Needed to Realize Potential

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