Gulf Coast seeing renewal in refining with gas plunge

The surge in natural gas production in the U.S. spurred by the development of shale gas deposits has led to a renaissance for the chemical refining industry in Texas, according to The Houston Chronicle.

The Gulf Coast, and Houston in particular, were traditionally a critical center for oil refining in the U.S., but rising energy prices combined with high land and labor costs pushed many firms to look elsewhere.

But with natural gas plummeting by 55 percent over the course of the past year, to fall below $2 per million British thermal units, a growing number of energy companies have decided to reinvest in refining plants in the region.

On Thursday, April 19, Dow Chemical Co. announced plans to construct a new $1.7 billion natural gas refining plant at its Freeport facilities south of Houston. This comes as part of a $4 billion investment plan the company announced for the region.

The Wall Street Journal reports Dow is not alone, with Royal Dutch Shell, Chevron, ConocoPhillips, Formosa Plastics and others intend to spend in excess of $8.7 billion investing in the region.

Information on recent developments in refining can be found at PennEnergy's Research area.

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