Natural Gas will Boost Segments of the Economy

    There is good news for a couple of segments of the economy.
    Energy costs are dropping and raw material costs for the chemical industry are also dropping. This comes about from the production of natural gas through the fracking process.
    It will be recalled that fracking involves pumping water into gas wells at high pressure in order to break up the ground strata and release the gas.
    For the energy sector, new electricity production can use lower-cost natural gas in new plants, which are less capital intensive will construction.
    For the chemical industry, low-cost natural gas, also gives low-cost ethane, which is a component of natural gas. The chemical industry uses ethane in a cracker to produce ethylene, which is a basic raw material for a number of plastics, including polyethylene and polyacrylates. The chemical industry is lauding this development. One of the celebration locations was the annual dinner meeting of the American Chemistry Council. CEO Calvin Dooley proposed a toast to shale gas, which is another term for natural gas from the fracking process.
    The price of shale gas has not yet reached the anticipated low point, but unless the EPA goofs up the program, the ACC celebration is not premature.
    It should be noted that markets for the downstream chemical products are not expanding in this recessionary economy, but the development has placed the US in a more favorable position to obtain business previously held by companies in other countries. An additional advantage is a reduction of supply line. Raw material access in close proximity to manufacturing plants and customers is a favorable advantage, because it reduces the likelihood of something going wrong in the supply line.
    Hooray for fracking and natural gas!