Pennsylvania’s chemical industry poised for a boom

Pittsburgh Chemical Day celebrates 50 years as Pennsylvania positions itself as a leader

Pittsburgh Chemical Day marks its 50th anniversary this year, at a time when western Pennsylvania finds itself on the cusp of an economic revolution due in large part to the chemical industry. There is a limited time frame for Pennsylvania to take advantage of this opportunity, and now is the time for action.

For the Pennsylvania chemical industry to keep growing, the state must attract capital investments to leverage western Pennsylvania’s resources. While natural gas production is expanding, elected officials need to focus on incentives for downstream chemical and plastics manufacturing expansion. Rather than asking, “How do we tax natural gas?” they should be asking, “How can we attract value-added chemical industry investment?” and, “How do we market Pennsylvania as a chemical leader?” It’s not just about adding the important pipeline construction jobs. The more impactful long-term play is to bring in companies that turn the ethane feedstocks into end-use products. Those companies will provide high-paying, sustainable jobs for tax-paying Pennsylvanians.

This conversation is beginning. Just look at Beaver County. The Shell cracker plant being built there is the first to be developed outside of the Houston/Gulf Coast area. After five years of careful consideration, Shell decided to invest $5 billion into the local economy to build the plant and create 600 permanent jobs.

It’s a smart move. Aside from benefiting Pennsylvanians, it provides geographic diversity for the nation’s chemical portfolio. Creating additional production outside the Gulf Coast makes the nation’s chemical industry less vulnerable to hurricanes and related natural disasters.

And Pennsylvania is a natural fit for that diversification. First and foremost, access to ethane is what drew Shell to Beaver County. But it wasn’t the only decider: Shell looked at all the intangibles and saw that locating near Pittsburgh was a boon to all involved.

The higher-education landscape also makes Pennsylvania appealing to the chemical industry. In addition to being home to notable institutions such as Carnegie Mellon University and the University of Pittsburgh, the state is especially well positioned to educate workers for the chemical field. Among only six accredited plastics engineering schools in the nation, two are in Pennsylvania: Penn State Behrend and Pennsylvania College of Technology.

These new graduates are making up a highly skilled workforce to fill the high-paying jobs created by natural gas liquids and downstream manufacturing. For example, Community College of Beaver County offers a two-year process technology program that will cost a student less than $14,000. When that student enters the chemical manufacturing industry, the starting salaries range from $40,000 to $60,000, with top wages at $90,000. This is a sizable return on investment that adds value to the community where these employees live and work.

By promoting western Pennsylvania as the next home of chemical manufacturing, we can position Pennsylvania as a global leader.

That’s what part of the focus will be at Pittsburgh Chemical Day on Oct. 3. This company-driven event is unique in that longtime competitors recognize this as a day to celebrate the industry, to connect with each other and to learn lessons from one another.

This year, Chemical Day kicks off with a pre-event mixer hosted by the Pennsylvania Chemical Industry Council (PCIC) at The Foundry Table & Tap on Oct. 2 from 6:30 to 9:30 p.m. Discussions at the conference on Oct. 3 will center around regulations, diversifications and more. Dr. Antonis Papadourakis, president and CEO of LANXESS Corp., will give the keynote address, followed by presentations from Pittsburgh Steelers legend Franco Harris and former Oakland Raider Phil Villapiano.

This is an exciting time for PCIC and our members. Our industry has greatly improved the quality of life for many. We face challenges like any other industry, but we strive to continue growing Pennsylvania’s chemical industry so we can better help not only each other but the communities we serve.

 

Jeffrey Logan is Bravo Group’s environmental and regulatory practice lead. He serves as president of the Pennsylvania Chemical Industry Council.