ERJ staff report (PR)
Paris – Dozens of industrial sites and thousands of jobs could be lost due to impact of the US shale gas on the competitiveness of French chemical producers, according to the Union of Chemical Industries (UIC).
The French industry association is calling on its national government to urgently introduce a ‘gas strategy’ to counter the two-to-three-fold advantage US-based producers now have in terms of energy and feedstock costs.
To back its case, the UIC commissioned research firm Carbone 4 to study the impact of the gas-price differential between France and the US on chemical producers.
This found that the shale gas boom is now attracting investments worth $117 million into the US, with the new capacity also threatening many facilities elsewhere in Europe.
According to UIC, 32 industrial sites could close in France with the loss of 10 000 direct jobs as a result of availability of cheaper US products and the decline in French competitiveness.
The Carbone 4 study covered four major value chains: ammonia, ethylene/polyethylene, chlor-alkali and polyamide 6.6. Of these, the ethylene chain was found to be most under heaviest attack by increasing US volumes - with an extra 11 million tonnes of ethylene, a third of current capacity - expected in 2017-2018.
Overall, Carbone 4 estimated that the entire US-based chemicals industry was at least twice as competitive in terms of the gas-price differential, electricity and raw materials used.
To counter the impact on the industry in France, the UIC wants the French government to exploit the country's shale gas resources, and take measures to mitigate the competitive pressures on the country’s gas-intensive industries.
The association called for lower transport costs, unification of the gas market in France, tax breaks for gas users, long-term contract options, as well as better access to LNG and the development of renewable energy sources particularly biogas.
"The Carbone 4 study underscores the dangers of inaction,” said Philippe Goebel, president of UIC. “Any proactive industrial policy of France … must include an ambitious gas strategy to preserve the chemical industry in France and to ensure it meets the challenges of climate change development.”