00:00:00.030 well welcome everybody thank you so much 00:00:02.00000:00:02.010 for joining us today my name is 00:00:04.19000:00:04.200 Katherine Specter I'm a research scholar 00:00:05.86900:00:05.879 at the center on global energy policy 00:00:07.70000:00:07.710 here at Columbia and tonight we're going 00:00:10.07000:00:10.080 to be talking about the IEA s new report 00:00:12.89000:00:12.900 the future of petrochemicals with its 00:00:15.44000:00:15.450 co-lead author Peter Levi who I will 00:00:19.07000:00:19.080 introduce in just a moment let me 00:00:21.74000:00:21.750 quickly say that this event like all of 00:00:23.57000:00:23.580 those at the center is being webcast 00:00:26.17900:00:26.189 live and both the full video and a 00:00:28.58000:00:28.590 podcast recording will be available on 00:00:30.62000:00:30.630 our website and on iTunes in the next 00:00:32.99000:00:33.000 couple of days and for those of you 00:00:35.27000:00:35.280 watching online as well as people here 00:00:37.43000:00:37.440 in the audience you can ask a question 00:00:38.56900:00:38.579 for the panelists at any time using the 00:00:40.79000:00:40.800 hashtag cg EP events and our twitter 00:00:44.29900:00:44.309 handle columbia at columbia you energy 00:00:47.18000:00:47.190 so keep that in mind I just want to say 00:00:50.86900:00:50.879 a few words as well about tonight's 00:00:52.52000:00:52.530 topic this study explores the role of 00:00:54.88900:00:54.899 petrochemicals in global energy today 00:00:58.09900:00:58.109 and also looks ahead to the future at 00:01:00.02000:01:00.030 the growing role that petrochemicals 00:01:01.79000:01:01.800 will play in oil and gas markets and 00:01:04.34000:01:04.350 global energy security and in many of 00:01:07.28000:01:07.290 the environmental themes that people are 00:01:09.02000:01:09.030 talking about today and I have to say 00:01:11.30000:01:11.310 this report is incredibly useful and and 00:01:14.06000:01:14.070 also well-timed this is a topic that 00:01:15.98000:01:15.990 many of us are grappling with now and 00:01:18.98000:01:18.990 here at the center one of the things 00:01:20.17900:01:20.189 we're working on is an analysis of 00:01:22.03900:01:22.049 long-term oil demand and petrochemicals 00:01:24.80000:01:24.810 are obviously a very key part of that I 00:01:27.49900:01:27.509 was particularly struck by the fact that 00:01:29.95000:01:29.960 last year we took a look at all the 00:01:32.14900:01:32.159 other studies at there on long-term oil 00:01:34.19000:01:34.200 demand and all those studies really did 00:01:36.17000:01:36.180 emphasize petrochemicals as the biggest 00:01:39.20000:01:39.210 source of oil demand growth in the 00:01:40.60900:01:40.619 future but at least in the publicly 00:01:43.67000:01:43.680 available materials none of them really 00:01:45.41000:01:45.420 got into why or had a whole lot of 00:01:47.38900:01:47.399 discussion about the rationale for that 00:01:50.84000:01:50.850 and I found that striking and it seemed 00:01:54.41000:01:54.420 to be as Peter terms at a real blind 00:01:57.10900:01:57.119 spot for the industry and as I started 00:01:59.69000:01:59.700 looking in the pet CEM sector myself I 00:02:01.39900:02:01.409 started to realize why it's because it's 00:02:03.31900:02:03.329 just very very difficult I think for 00:02:06.17000:02:06.180 that reason we're really happy that IA 00:02:09.41000:02:09.420 has spent the time and effort on this 00:02:11.42000:02:11.430 report just to give one example 00:02:13.85000:02:13.860 the expected shift to alternative 00:02:15.17000:02:15.180 passenger vehicles whether it's electric 00:02:17.45000:02:17.460 vehicles automated vehicles is expected 00:02:20.78000:02:20.790 to reduce gasoline demand going forward 00:02:23.27000:02:23.280 which should free up some light and 00:02:24.74000:02:24.750 material for nap the production which is 00:02:26.93000:02:26.940 of course one of the primary feedstocks 00:02:28.52000:02:28.530 for petrochemicals at the same time the 00:02:31.63000:02:31.640 expectation is that these new types of 00:02:34.16000:02:34.170 vehicles will be constructed with a lot 00:02:36.29000:02:36.300 more plastic which will in turn increase 00:02:38.66000:02:38.670 demand for petrochemicals so there are a 00:02:40.91000:02:40.920 lot of interesting interactions and 00:02:43.07000:02:43.080 feedback loops like that that make it 00:02:45.35000:02:45.360 very difficult in addition to the fact 00:02:47.72000:02:47.730 that even I think by energy market 00:02:49.91000:02:49.920 standards the challenges presented by 00:02:52.25000:02:52.260 the availability and quality of data in 00:02:54.89000:02:54.900 the sector are really a very big 00:02:57.19900:02:57.209 challenge and so this report does a 00:02:58.61000:02:58.620 tremendous service I think to the energy 00:03:00.44000:03:00.450 community by not only compiling and 00:03:02.57000:03:02.580 analyzing a really impressive collection 00:03:05.69000:03:05.700 of data on this topic but also mapping 00:03:08.09000:03:08.100 out many of these complexities and 00:03:10.16000:03:10.170 trying to make sense of them I want to 00:03:15.26000:03:15.270 just introduce our speakers peter is an 00:03:21.59000:03:21.600 energy analyst in the energy technology 00:03:23.60000:03:23.610 and policy division of the International 00:03:25.46000:03:25.470 Energy Agency or the IEA he focuses on 00:03:28.28000:03:28.290 analyzing energy intensive industries 00:03:30.00900:03:30.019 particularly the chemical and 00:03:31.58000:03:31.590 petrochemical sectors but also on other 00:03:33.97900:03:33.989 cross-cutting themes with respect to 00:03:35.66000:03:35.670 decarbonisation prior to joining the IEA 00:03:38.42000:03:38.430 Peter attended the University of 00:03:39.68000:03:39.690 Cambridge and the University of Bristol 00:03:41.03000:03:41.040 obtaining degrees at both of those 00:03:43.49000:03:43.500 universities both in engineering peter 00:03:45.83000:03:45.840 also worked in the private sector as an 00:03:47.33000:03:47.340 engineer for for a number of years peter 00:03:50.57000:03:50.580 is going to give us an overview of the 00:03:51.89000:03:51.900 findings of the IEA study and then we're 00:03:53.84000:03:53.850 going to have a little bit of a 00:03:55.25000:03:55.260 discussion around that and be joined by 00:03:58.24000:03:58.250 Jason Board of who I think needs no 00:04:01.58000:04:01.590 introduction but I'll introduce him 00:04:03.11000:04:03.120 anyway 00:04:04.31000:04:04.320 he Jason is going to offer a few 00:04:08.78000:04:08.790 reactions to the presentation and 00:04:10.44900:04:10.459 participate in some Q&A with us Jason 00:04:14.84000:04:14.850 joined the Columbia faculty after 00:04:16.13000:04:16.140 serving a special assistant to President 00:04:17.90000:04:17.910 Obama and Senior Director for Energy and 00:04:19.82000:04:19.830 Climate Change on the staff of the 00:04:21.62000:04:21.630 National Security Council and prior to 00:04:23.18000:04:23.190 that held senior positions on the White 00:04:25.70000:04:25.710 House's national 00:04:26.73000:04:26.740 Council and the Council on Environmental 00:04:28.62000:04:28.630 Quality in addition to teaching at 00:04:30.90000:04:30.910 Columbia's SEPA school Jason is of 00:04:33.21000:04:33.220 course our founding director at the 00:04:34.55900:04:34.569 center on global energy policy so 00:04:37.20000:04:37.210 without further ado I'd like to invite 00:04:39.33000:04:39.340 Peter up to walk us through some of the 00:04:41.37000:04:41.380 study's findings and then we'll have 00:04:43.40900:04:43.419 plenty of time for discussion afterwards 00:04:44.93900:04:44.949 Peter thank you thank you very much 00:04:56.37000:04:56.380 Katherine and thank you all for inviting 00:04:58.46900:04:58.479 me here to speak and it's a real 00:05:00.30000:05:00.310 privilege to come disseminate this 00:05:02.27900:05:02.289 report after working on it with my with 00:05:05.12900:05:05.139 my colleagues and back at the IEA and so 00:05:09.62900:05:09.639 as Katherine said I'm here to talk about 00:05:11.24900:05:11.259 their future of petrochemicals 00:05:12.54000:05:12.550 publication that was released online on 00:05:15.45000:05:15.460 the 5th of October and it's available 00:05:17.30900:05:17.319 freely on the website you'll have to 00:05:20.30900:05:20.319 register to to download it but it's it's 00:05:22.83000:05:22.840 freely available there also Arabic and 00:05:25.11000:05:25.120 Mandarin translations available on the 00:05:27.27000:05:27.280 website and there's copies of the 00:05:29.61000:05:29.620 executive summary printed out at the 00:05:31.26000:05:31.270 back if you would like to take one with 00:05:32.67000:05:32.680 you and I'm sure I don't need to do this 00:05:36.68900:05:36.699 in this for this audience but and just 00:05:38.99900:05:39.009 to give a brief background of the IEA 00:05:41.33900:05:41.349 itself and just on a couple of slides 00:05:43.40900:05:43.419 and the IEA is an autonomous 00:05:45.24000:05:45.250 organization that works around the world 00:05:46.86000:05:46.870 to support accelerated energy 00:05:48.45000:05:48.460 transitions it does this with data there 00:05:52.35000:05:52.360 and access from its member countries and 00:05:54.20900:05:54.219 Beyond and this shows some of the IAS 00:05:57.99000:05:58.000 family in a few slides 00:05:59.70000:05:59.710 so the wider global family its member 00:06:01.92000:06:01.930 countries there's 30 member countries 00:06:03.45000:06:03.460 the Association and accession countries 00:06:05.99900:06:06.009 and and partner countries and then also 00:06:11.12900:06:11.139 the the wider network of countries that 00:06:13.20000:06:13.210 the IEA works with to build its energy 00:06:15.71900:06:15.729 data sets and so the IEA is using this 00:06:20.87900:06:20.889 data and its expertise in this area to 00:06:23.15900:06:23.169 look into what our executive director 00:06:25.46900:06:25.479 not me if not me sadly but our executive 00:06:28.17000:06:28.180 director terms coined this phrase of 00:06:30.24000:06:30.250 blind spots in the energy system and and 00:06:32.99900:06:33.009 this started by looking in the role of 00:06:34.74000:06:34.750 the future of trucks then the future of 00:06:37.95000:06:37.960 cooling and 20 00:06:39.15000:06:39.160 this year and then now the future future 00:06:42.00000:06:42.010 of petrochemicals this serious started 00:06:44.10000:06:44.110 in 2017 so it's relatively new button 00:06:46.32000:06:46.330 and this is the third in the series so 00:06:53.31000:06:53.320 I'd like to start by giving an overview 00:06:55.35000:06:55.360 of the role of petrochemicals today in 00:06:57.51000:06:57.520 in society and in the energy system and 00:07:00.54000:07:00.550 also the role with respect of its role 00:07:03.69000:07:03.700 with respect to the environment and the 00:07:07.17000:07:07.180 first kind of perhaps obvious point to 00:07:10.14000:07:10.150 many of you but one that's worth 00:07:12.12000:07:12.130 emphasizing is that petrochemicals are 00:07:13.89000:07:13.900 all around us and in this room we've got 00:07:16.98000:07:16.990 tables full of plastic bottles plastic 00:07:18.90000:07:18.910 chairs and this you never have to look 00:07:21.54000:07:21.550 very far in the built environment to see 00:07:23.76000:07:23.770 a petrochemical product so just to 00:07:26.28000:07:26.290 provide to draw out a few examples and 00:07:27.81000:07:27.820 this slide and this infographic we 00:07:29.13000:07:29.140 produced and so there's a cluster of 00:07:32.58000:07:32.590 things that you find around the home in 00:07:33.90000:07:33.910 office many personal items digital 00:07:36.30000:07:36.310 devices clothing polyester clothing and 00:07:40.44000:07:40.450 then in the background PVC important 00:07:43.47000:07:43.480 material and buildings plastic pipes 00:07:45.47000:07:45.480 membranes waterproof membranes and in 00:07:48.24000:07:48.250 houses and and damp proof courses then 00:07:51.84000:07:51.850 we've got a set of products that are 00:07:52.95000:07:52.960 integral to our food supplier now and 00:07:55.46000:07:55.470 and yeah and even drinks and securing a 00:08:00.39000:08:00.400 food supply from the farm to the plate 00:08:02.31000:08:02.320 so we've got fertilizers pesticides and 00:08:05.58000:08:05.590 of course packaging both in the 00:08:07.23000:08:07.240 background getting it from between 00:08:09.33000:08:09.340 businesses but then also they're the 00:08:11.10000:08:11.110 consumer packaging that we will interact 00:08:13.02000:08:13.030 with then we've got another cluster of 00:08:16.82000:08:16.830 products that facilitate transportation 00:08:19.53000:08:19.540 and so we've got tires plastics and cars 00:08:24.47000:08:24.480 various fluids in a multitude of 00:08:27.65900:08:27.669 vehicles acids and hydraulic fluids all 00:08:30.45000:08:30.460 containing petrochemical products and 00:08:32.81000:08:32.820 then finally just to draw your attention 00:08:34.95000:08:34.960 to a kind of close to home topic for the 00:08:37.32000:08:37.330 IEA and petrochemicals are used in in 00:08:41.31000:08:41.320 many aspects of technologies and 00:08:44.28000:08:44.290 products that we will need for the clean 00:08:45.78000:08:45.790 energy transition wind turbine blades 00:08:48.27000:08:48.280 here is an important example of 00:08:49.89000:08:49.900 lightweight carbon fiber composites 00:08:52.34000:08:52.350 the other materials both of the future 00:08:54.89000:08:54.900 and traditional materials that we use 00:08:56.30000:08:56.310 today for these technologies so now 00:09:03.77000:09:03.780 taking a bit of a look back Petro 00:09:05.51000:09:05.520 chemicals have been demand for the 00:09:07.73000:09:07.740 petrochemical products have been growing 00:09:09.05000:09:09.060 very fast and if we focus on plastics 00:09:11.93000:09:11.940 here in the context of broader bulk 00:09:14.09000:09:14.100 material demand and until the millennium 00:09:17.18000:09:17.190 several of these bulk materials group 00:09:18.76000:09:18.770 broadly in line with GDP is include 00:09:22.61000:09:22.620 aluminium cement and steel and after the 00:09:27.92000:09:27.930 million many of these materials picked 00:09:30.02000:09:30.030 up their pace broadly because of China's 00:09:33.26000:09:33.270 economic growth and development to 00:09:35.65000:09:35.660 support it's a huge explosion of 00:09:39.01000:09:39.020 infrastructure and construction projects 00:09:42.32000:09:42.330 and then plastics key group of 00:09:45.38000:09:45.390 petrochemical products which I'll talk 00:09:46.61000:09:46.620 about a lot in this presentation and 00:09:48.49000:09:48.500 have grown faster than any of these bulk 00:09:50.96000:09:50.970 materials over this time period grown by 00:09:53.06000:09:53.070 almost tenfold since 1970 and nearly 00:09:55.82000:09:55.830 doubling since the millennium more than 00:09:58.28000:09:58.290 doubling since millennium this is 00:10:00.83000:10:00.840 explained in part by the fact that since 00:10:02.75000:10:02.760 the middle of the last century plastics 00:10:04.28000:10:04.290 have become substitutes for many of the 00:10:05.93000:10:05.940 other materials in this in this picture 00:10:07.91000:10:07.920 and other materials outside it and this 00:10:10.61000:10:10.620 is because plastics are relatively cheap 00:10:12.23000:10:12.240 they're versatile and they can offer 00:10:14.03000:10:14.040 quite tailored solutions to a given 00:10:16.85000:10:16.860 material application and sticking with 00:10:22.07000:10:22.080 plastics again and this group of 00:10:25.34000:10:25.350 materials will continue to be a big 00:10:27.26000:10:27.270 demand driver for their for the 00:10:28.88000:10:28.890 petrochemical sector and advanced 00:10:32.12000:10:32.130 economies such as the US and Korea and 00:10:34.19000:10:34.200 Canada currently consume up to 20 times 00:10:37.10000:10:37.110 as much plastic resin as those of 00:10:39.14000:10:39.150 developing countries and such as India 00:10:41.72000:10:41.730 many countries in Africa and plastic 00:10:45.77000:10:45.780 demand is driven in part by manufactured 00:10:47.93000:10:47.940 domestic manufacturing industries to 00:10:49.43000:10:49.440 make other plastic products but also by 00:10:52.01000:10:52.020 export markets in 2016 the US and Saudi 00:10:55.49000:10:55.500 Arabia were the biggest export of 00:10:57.17000:10:57.180 polyethylene which is a key plastic 00:10:59.00000:10:59.010 resin again something that will come up 00:11:01.19000:11:01.200 quite a lot in this presentation the 00:11:03.10000:11:03.110 largest import was China 00:11:05.68900:11:05.699 followed by Germany petrochemical 00:11:10.57900:11:10.589 sectors a very large consumer of oil and 00:11:12.71000:11:12.720 gas today the secretary accounts for 14% 00:11:15.97900:11:15.989 of 30 million barrels per day 00:11:17.62900:11:17.639 NBD of global demand and 8% or 300 00:11:22.24900:11:22.259 billion cubic meters of gas demand so 00:11:30.04900:11:30.059 half of the chemical sectors total 00:11:32.62900:11:32.639 energy inputs are consumed as feedstock 00:11:34.15900:11:34.169 and when I say feedstock I'm referring 00:11:36.47000:11:36.480 to the fuels oil and gas the same fuels 00:11:40.15900:11:40.169 that are used to fuel the chemical 00:11:41.47900:11:41.489 sector are also used as its speed stocks 00:11:43.42900:11:43.439 but these are become physically embedded 00:11:45.67900:11:45.689 in the products themselves and the 00:11:46.99900:11:47.009 molecules of oil and gas that I've taken 00:11:50.29900:11:50.309 out of the ground then becoming 00:11:51.79900:11:51.809 physically embedded in the plastic 00:11:53.03000:11:53.040 products that we we use every day 00:11:55.65900:11:55.669 this diagram shows how oil and gas but 00:11:58.66900:11:58.679 also coal are used as raw materials to 00:12:02.44900:12:02.459 produce different primary chemicals and 00:12:04.09900:12:04.109 how they're then converted further 00:12:06.25900:12:06.269 downstream into commodities and 00:12:09.25900:12:09.269 ultimately consumer goods oils the 00:12:12.43900:12:12.449 promit prominent predominant feedstock 00:12:14.86900:12:14.879 for high-value chemicals which are the 00:12:16.30900:12:16.319 main precursors to plastics and then 00:12:19.84900:12:19.859 coal and gas and the main feedstocks for 00:12:22.24900:12:22.259 ammonia and methanol and these are these 00:12:24.01900:12:24.029 are the main chemicals that we look at 00:12:25.27900:12:25.289 in in the analysis HV C's or high-value 00:12:30.82900:12:30.839 chemicals ammonia and methanol count for 00:12:32.90000:12:32.910 around two-thirds of the total energy 00:12:34.75900:12:34.769 inputs to the to the chemical and 00:12:36.47000:12:36.480 petrochemical sector so you can imagine 00:12:38.96000:12:38.970 my reach narrower analytical scope to 00:12:41.92900:12:41.939 the to the 8020 benefits of that 00:12:44.73900:12:44.749 selection so when looking at the 00:12:50.41900:12:50.429 petrochemical industry in a more 00:12:51.73900:12:51.749 regional fashion and there's we can see 00:12:55.00900:12:55.019 that there's no one-size-fits-all for 00:12:56.68900:12:56.699 either production or feedstock use so 00:13:00.65000:13:00.660 asia-pacific particularly China 00:13:02.73900:13:02.749 dominates global primary chemical 00:13:05.21000:13:05.220 production and with Europe North America 00:13:08.62900:13:08.639 and the Middle East 00:13:09.61900:13:09.629 accounting for most of the rest 00:13:12.85000:13:12.860 translating this into the feedstock 00:13:14.74900:13:14.759 picture and there's also significant 00:13:17.60000:13:17.610 diversity among the share 00:13:19.12900:13:19.139 of resources used in each region to 00:13:20.80900:13:20.819 produce these primary chemicals if we 00:13:23.96000:13:23.970 look at the four largest regions and 00:13:26.32900:13:26.339 these regions are returned to and 00:13:28.32900:13:28.339 because they're important from multiple 00:13:32.05900:13:32.069 points of view but very interesting on 00:13:33.94900:13:33.959 this feedstock diversity picture and 00:13:37.51900:13:37.529 along with the Middle East the US has a 00:13:40.54900:13:40.559 feedstock advantage in its access to 00:13:42.97900:13:42.989 low-cost ethane to abundant supplies of 00:13:46.09900:13:46.109 natural gas and the and the shale gas 00:13:48.16900:13:48.179 revolution in contrast Asia Pacific and 00:13:52.09900:13:52.109 Europe rely mainly on naphtha and where 00:13:55.40000:13:55.410 the when the spread between prices of 00:13:57.49900:13:57.509 natural gas liquids and crude is as 00:14:00.13900:14:00.149 large this puts these regions at a 00:14:02.26900:14:02.279 disadvantage in terms of feedstock cost 00:14:07.29900:14:07.309 China constitutes a key outlier and on 00:14:11.09000:14:11.100 the feedstock front because it uses 00:14:13.03900:14:13.049 quite a lot of coals feedstock around a 00:14:15.01900:14:15.029 quarter of the feedstock used in Egypt 00:14:17.84000:14:17.850 Asia Pacific to produce primary 00:14:19.54900:14:19.559 chemicals it's coal and I think nearly 00:14:22.15900:14:22.169 all of that is in China so these 00:14:28.12900:14:28.139 difference in feedstocks choices across 00:14:30.59000:14:30.600 regions are reflect a reflection and the 00:14:32.68900:14:32.699 big contribution of feedstock costs to 00:14:34.48900:14:34.499 production costs in this slide we're 00:14:36.82900:14:36.839 displaying simplified levelized cost to 00:14:38.98900:14:38.999 petrochemicals which is a a metric that 00:14:41.32900:14:41.339 can be taken as a proxy for overall 00:14:43.42900:14:43.439 production cost the middle-east and the 00:14:46.46000:14:46.470 u.s. remain the regions where producing 00:14:48.53000:14:48.540 these commodities from ethane is more 00:14:50.80900:14:50.819 advantageous 00:14:51.59000:14:51.600 whereas naphtha based production is less 00:14:53.35900:14:53.369 economical but dominant in other regions 00:14:55.66900:14:55.679 due to their lack of access to low cost 00:14:58.57900:14:58.589 ethane the feedstock choice doesn't only 00:15:02.05900:15:02.069 impact costs but also the process yields 00:15:04.22000:15:04.230 so you don't get the same diversity of 00:15:06.19900:15:06.209 products from using ethane so you have 00:15:08.23900:15:08.249 to use other on-purpose technologies to 00:15:10.10000:15:10.110 produce some of the products that are in 00:15:11.60000:15:11.610 deficit whereas naphtha produces lower 00:15:15.22900:15:15.239 amounts of high-value chemicals per you 00:15:17.26900:15:17.279 know the naps are used but then you get 00:15:19.12900:15:19.139 a better balance between the products 00:15:21.37900:15:21.389 you produce ethylene propylene and and 00:15:23.26900:15:23.279 the aromatics 00:15:27.53000:15:27.540 and so now looking at their kind of the 00:15:31.19000:15:31.200 petrochemical refining dimension again 00:15:33.51000:15:33.520 something I'll return to on subsequent 00:15:35.49000:15:35.500 slides and with growing demand for 00:15:38.19000:15:38.200 petrochemical products oil companies 00:15:40.05000:15:40.060 especially the refining components of 00:15:42.06000:15:42.070 the oil industry are increasingly 00:15:43.59000:15:43.600 expanding into their petrochemicals 00:15:45.06000:15:45.070 business through what we call like 00:15:47.13000:15:47.140 refining petrochemical integration there 00:15:49.20000:15:49.210 are various forms of this that we go 00:15:51.72000:15:51.730 into more in more detail in the reports 00:15:54.63000:15:54.640 various degrees and various models for 00:15:56.55000:15:56.560 doing so but the current interest in 00:15:59.34000:15:59.350 petrochemical integration reflects the 00:16:01.73000:16:01.740 preoccupation refining industry to seek 00:16:04.23000:16:04.240 more resilient forms of revenue in the 00:16:06.24000:16:06.250 face of a stagnating or potentially 00:16:09.63000:16:09.640 stagnating demand for traditional 00:16:11.10000:16:11.110 products and so in recent years margins 00:16:14.19000:16:14.200 from selling transport fuels such as 00:16:15.60000:16:15.610 gasoline and diesel have narrowed and 00:16:17.85000:16:17.860 selling petrochemical feedstocks raw is 00:16:21.32900:16:21.339 in many cases not profitable as the 00:16:23.55000:16:23.560 prices for naphtha and LPG are often 00:16:25.35000:16:25.360 below the the price at which it costs 00:16:27.26900:16:27.279 below the cost price of extracting them 00:16:29.43000:16:29.440 and and the petrochemical paths can 00:16:32.43000:16:32.440 order can offer higher margins by 00:16:34.50000:16:34.510 converting them into a more high-value 00:16:36.45000:16:36.460 product and this this slide shows the 00:16:38.88000:16:38.890 some margins for the European context 00:16:41.90000:16:41.910 for fuels and for the petrochemical 00:16:45.27000:16:45.280 routes and of course intricate 00:16:48.96000:16:48.970 integration between refineries and 00:16:50.49000:16:50.500 petrochemical plants can offer other 00:16:51.72000:16:51.730 benefits that you would have in any in 00:16:54.60000:16:54.610 more generic industrial integration 00:16:56.82000:16:56.830 benefits sharing utilities integrating 00:16:59.79000:16:59.800 process flows capturing waste heat all 00:17:03.32900:17:03.339 of those benefits are also able to be 00:17:05.40000:17:05.410 captured by the through greater 00:17:06.68900:17:06.699 integration potentially and as I said 00:17:12.78000:17:12.790 integration comes in many different 00:17:14.22000:17:14.230 forms and flavors for example in the US 00:17:17.06900:17:17.079 and the Middle East they're readily 00:17:18.48000:17:18.490 available in natural gas liquids and so 00:17:21.24000:17:21.250 this leads the upstream petrochemical to 00:17:24.60000:17:24.610 refining sorry a upstream natural gas 00:17:29.40000:17:29.410 liquid production and then petrochemical 00:17:32.07000:17:32.080 production as the prevailing option for 00:17:34.86000:17:34.870 integration many oil companies who 00:17:37.95000:17:37.960 produce NGOs have also invested in 00:17:39.66000:17:39.670 petrochemical production 00:17:40.68000:17:40.690 facilities notably around the Gulf Coast 00:17:42.71000:17:42.720 but there is no operation or overlap as 00:17:45.53900:17:45.549 such between these facilities in other 00:17:48.24000:17:48.250 regions where there's limited available 00:17:50.66900:17:50.679 where availability of NGOs is limited 00:17:53.19000:17:53.200 and and therefore they use naphtha as a 00:17:55.95000:17:55.960 feedstock the case for operational 00:17:57.86900:17:57.879 integration is is stronger from our 00:18:02.43000:18:02.440 analysis of this topic 00:18:03.60000:18:03.610 it seems that of the role of oil 00:18:06.65900:18:06.669 companies in the petrochemical sphere is 00:18:08.70000:18:08.710 set to increase and but in a variety of 00:18:11.39900:18:11.409 different ways of showing the u.s. 00:18:12.62900:18:12.639 context but we also look at the Chinese 00:18:14.31000:18:14.320 context which is quite different and 00:18:18.32000:18:18.330 then the last thing I want to revisit in 00:18:20.85000:18:20.860 the kind of petrochemicals today of 00:18:23.22000:18:23.230 section the presentation is the the 00:18:24.77900:18:24.789 environmental toll that petrochemical 00:18:26.87900:18:26.889 products as a petrochemicals take on the 00:18:29.75900:18:29.769 environment and the chemical sector is 00:18:32.22000:18:32.230 the largest industrial energy consumer 00:18:33.96000:18:33.970 that's something that some people find 00:18:35.22000:18:35.230 surprising they're not familiar with the 00:18:37.64900:18:37.659 energy statistics and it's a head of 00:18:40.59000:18:40.600 iron and steel and cement accounts for 00:18:44.43000:18:44.440 approximately 10% of total final energy 00:18:46.71000:18:46.720 consumption and almost 30% of industrial 00:18:49.23000:18:49.240 final energy consumption however this 00:18:51.62900:18:51.639 sector is only the third largest source 00:18:53.34000:18:53.350 of co2 emissions and this is because of 00:18:56.00900:18:56.019 this feedstock concept that I introduced 00:18:58.20000:18:58.210 earlier and that half of their more than 00:19:00.14900:19:00.159 half of the feeds chemical sectors 00:19:02.36900:19:02.379 energy input becomes in but embedded in 00:19:04.37900:19:04.389 the in the products themselves and 00:19:05.78900:19:05.799 there's not combusted 00:19:06.65900:19:06.669 not leading to co2 emissions within the 00:19:09.14900:19:09.159 boundary of the chemical sector but 00:19:14.58000:19:14.590 there are two important takeaways from 00:19:18.26900:19:18.279 this picture that maybe are in the 00:19:21.21000:19:21.220 background 00:19:21.74900:19:21.759 and although feedstock inputs don't 00:19:25.40900:19:25.419 contribute to emissions within the 00:19:26.75900:19:26.769 chemical sector and they they contribute 00:19:30.29900:19:30.309 to process emissions and they can 00:19:31.64900:19:31.659 contribute to emissions downstream of 00:19:33.29900:19:33.309 the chemical sector depending on how 00:19:35.03900:19:35.049 chemical products are disposed of and 00:19:37.40900:19:37.419 used and and secondly although the 00:19:40.68000:19:40.690 chemical sector is the third largest 00:19:42.02900:19:42.039 emitter is still a very large emitter 00:19:43.97000:19:43.980 approximately 1.5 gigatons per year of 00:19:47.03900:19:47.049 co2 and then a further three to four 00:19:50.19000:19:50.200 hundred million tonnes of co2 equivalent 00:19:51.89900:19:51.909 in 00:19:52.47000:19:52.480 non co2 ghd's greenhouse gases and so 00:19:58.08000:19:58.090 now I'd like to move to talk about one 00:20:00.27000:20:00.280 of the two futures that we outline 00:20:02.94000:20:02.950 potential futures do we outline for 00:20:04.77000:20:04.780 their their chemical and petrochemical 00:20:05.78900:20:05.799 sector and the first one we called the 00:20:08.28000:20:08.290 reference technology scenario and I'll 00:20:09.63000:20:09.640 spend relatively less time on this and 00:20:12.23000:20:12.240 and the reference technology scenario 00:20:15.65900:20:15.669 projects forward current trends that we 00:20:17.49000:20:17.500 observe today and such as announced 00:20:19.86000:20:19.870 capacity additions and things in the 00:20:22.50000:20:22.510 physical domain but also takes account 00:20:25.59000:20:25.600 of firm policy commitments that would 00:20:28.71000:20:28.720 have an impact on there but on the 00:20:30.06000:20:30.070 petrochemical sector so we expect demand 00:20:35.25000:20:35.260 for plastics one of the key drivers of 00:20:36.93000:20:36.940 the sector to remain relatively robust 00:20:39.71000:20:39.720 and this diagram shows key 00:20:45.29900:20:45.309 thermoplastics that we analyzed in 00:20:47.31000:20:47.320 detail that we characterize in detail 00:20:48.69000:20:48.700 with the in the in the modeling and as 00:20:52.38000:20:52.390 developing countries increase their 00:20:53.88000:20:53.890 population and wealth these materials 00:20:55.32000:20:55.330 are increasingly in demand and and 00:20:57.69000:20:57.700 particularly sector sectors such as 00:20:59.37000:20:59.380 packaging and construction key growth 00:21:02.34000:21:02.350 areas for for these materials on a per 00:21:07.23000:21:07.240 capita basis demand for these plastics 00:21:09.78000:21:09.790 increases by more than 50 percent 00:21:11.10000:21:11.110 between 2020 2010 and 2050 and and on an 00:21:16.20000:21:16.210 absolute basis I believe it's more than 00:21:18.69000:21:18.700 more than doubling 00:21:24.96000:21:24.970 so now in our base case in reference 00:21:28.02000:21:28.030 technologies scenario petrochemicals are 00:21:30.12000:21:30.130 the largest single driver of oil demand 00:21:31.82000:21:31.830 they're expected to count for more than 00:21:34.05000:21:34.060 a third of total oil demand to 2030 and 00:21:37.92000:21:37.930 more and nearly half to 2050 total oil 00:21:42.33000:21:42.340 demand rises by nearly 10 million 00:21:44.07000:21:44.080 barrels per day to 2030 in the reference 00:21:46.50000:21:46.510 technology scenario this is across the 00:21:47.82000:21:47.830 whole energy system and and this is 00:21:50.07000:21:50.080 fueled by five key drivers and shipping 00:21:55.01000:21:55.020 shipping is an important driver here and 00:21:58.86000:21:58.870 it's it's actually its importance looks 00:22:00.60000:22:00.610 diminished because it's in a category 00:22:02.40000:22:02.410 with other sectors that are declining 00:22:03.96000:22:03.970 but around one one MBD of shipping oil 00:22:08.04000:22:08.050 demand growth in the RTS by 2030 and 00:22:11.31000:22:11.320 this is fueled by expanding global 00:22:13.89000:22:13.900 seaborne trade passenger vehicles is the 00:22:18.66000:22:18.670 second one oil use in cars peaks in the 00:22:21.57000:22:21.580 mid 2020s even though the global card 00:22:23.40000:22:23.410 fleet rises by 50% in 2030 and this 00:22:26.79000:22:26.800 leads to a 1.6 MBD increase aviation is 00:22:31.98000:22:31.990 number three and consumption the 00:22:35.49000:22:35.500 aviation sector increases by about two 00:22:37.23000:22:37.240 MBD but between today and 2030 because 00:22:39.60000:22:39.610 of the robust increases in travel demand 00:22:41.31000:22:41.320 particularly in Asia and I believe it's 00:22:44.85000:22:44.860 oh no this is to do with road freight to 00:22:47.73000:22:47.740 the India figure I have here but it road 00:22:50.70000:22:50.710 freight is number four just by 00:22:53.04000:22:53.050 improvements in vehicle and logistical 00:22:54.96000:22:54.970 efficiencies or demand for trucks grows 00:22:56.70000:22:56.710 by 2.5 MBD and this is driven in part by 00:23:01.59000:23:01.600 India expanding by a factor of three its 00:23:04.43000:23:04.440 transport demand for goods and services 00:23:06.53000:23:06.540 fight via trucking and then the largest 00:23:11.76000:23:11.770 driver petrochemicals 00:23:13.20000:23:13.210 um oil for petrochemical feedstocks 00:23:15.84000:23:15.850 growth away more than 3 million barrels 00:23:17.43000:23:17.440 per day but by 2030 in there in the 00:23:19.95000:23:19.960 reference technology scenario while 00:23:21.93000:23:21.940 there are increasing efforts in certain 00:23:23.52000:23:23.530 regions to reduce the demand for 00:23:25.38000:23:25.390 single-use plastics and increase 00:23:26.88000:23:26.890 recycling and the overall underlying 00:23:29.76000:23:29.770 demand for these materials and outweighs 00:23:33.06000:23:33.070 this outweighs these efforts 00:23:36.78000:23:36.790 and in terms of how where this demand 00:23:41.62000:23:41.630 and production takes place or where the 00:23:43.12000:23:43.130 production side takes place this slide 00:23:44.62000:23:44.630 shows the the regional distribution 00:23:46.63000:23:46.640 China in the US should show the largest 00:23:51.01000:23:51.020 near-term capacity additions as a result 00:23:53.29000:23:53.300 of the feedstock advantages that was 00:23:55.09000:23:55.100 talking about earlier and in China's 00:23:57.10000:23:57.110 case especially a strong source of local 00:23:59.08000:23:59.090 demand for manufacturing longer term 00:24:02.08000:24:02.090 growth is led by the Middle East 00:24:03.43000:24:03.440 and then the rest of Asia are still and 00:24:05.77000:24:05.780 particularly China by 2050 Asia Pacific 00:24:09.76000:24:09.770 retains its position as the largest 00:24:12.79000:24:12.800 chemical producing region and I should 00:24:14.95000:24:14.960 draw your attention to this graph it's 00:24:17.11000:24:17.120 quite small there that the axis for Asia 00:24:19.45000:24:19.460 Pacific is I think three times the scale 00:24:23.08000:24:23.090 of the other the other graphs so when 00:24:28.21000:24:28.220 looking at the four key regions that I 00:24:29.68000:24:29.690 mentioned earlier Europe Middle East and 00:24:31.84000:24:31.850 North America and Asia Pacific and we if 00:24:36.13000:24:36.140 we can zoom in on the exact feed stocks 00:24:38.41000:24:38.420 they're using in each year here um e 00:24:41.14000:24:41.150 Thames feed stock consumption for 00:24:42.88000:24:42.890 high-value chemicals grows by 70 percent 00:24:44.83000:24:44.840 by 2030 and in the favored region so the 00:24:48.25000:24:48.260 US and the Middle East and North 00:24:50.68000:24:50.690 American Middle East but mainly in the 00:24:51.88000:24:51.890 US and and in part this growth is as a 00:24:55.84000:24:55.850 result of exports and to of 00:24:59.23000:24:59.240 petrochemical products to to Europe 00:25:03.57000:25:03.580 however regions with continuing strong 00:25:06.25000:25:06.260 growth in the in the long term rely 00:25:08.38000:25:08.390 mostly on naphtha so this e same kind of 00:25:11.59000:25:11.600 expansion in the shorter term in the 00:25:13.90000:25:13.910 Middle East in the US is is not a 00:25:15.85000:25:15.860 sustained thing throughout the scenario 00:25:17.73000:25:17.740 longer term growth is shifts more to 00:25:20.59000:25:20.600 naphtha as the availability of ethane 00:25:22.75000:25:22.760 and ngl supplied Titans in the in the 00:25:25.78000:25:25.790 late 2020s and then just a quick look 00:25:30.28000:25:30.290 here at ammonia which is a key precursor 00:25:32.68000:25:32.690 to most nitrogen nitrogenous fertilisers 00:25:35.95000:25:35.960 all nitrogen all nitrogenous fertilisers 00:25:38.35000:25:38.360 I believe and mainly natural gas across 00:25:41.74000:25:41.750 most regions across our the important 00:25:44.08000:25:44.090 regions we identify but then this strong 00:25:46.90000:25:46.910 but flat 00:25:47.88000:25:47.890 use of coal in in asia-pacific and again 00:25:51.57000:25:51.580 mainly in China so I'd like to move now 00:25:56.43000:25:56.440 to just talk about the alternative 00:25:58.08000:25:58.090 future that we envisage for the for the 00:26:00.39000:26:00.400 petrochemical sector whether we know we 00:26:02.61000:26:02.620 project forward and and actually it's 00:26:05.43000:26:05.440 not projecting forward this scenario is 00:26:07.20000:26:07.210 very different to the reference 00:26:08.22000:26:08.230 technology scenario we start with a goal 00:26:09.78000:26:09.790 and I'm sure some of you are familiar 00:26:12.39000:26:12.400 with the IEA s other scenarios this is a 00:26:15.24000:26:15.250 sustainable development scenario 00:26:16.77000:26:16.780 provides the global energy system 00:26:18.63000:26:18.640 context for this for this deep dive into 00:26:21.63000:26:21.640 the chemical sector and and this starts 00:26:24.15000:26:24.160 from a series of goals that we want to 00:26:26.64000:26:26.650 get to sustainability goals and then 00:26:28.83000:26:28.840 works backwards to where we where we 00:26:30.84000:26:30.850 what we need to do to get there and so 00:26:34.59000:26:34.600 more specifically where we want to get 00:26:36.09000:26:36.100 to is a more sustainable chemical 00:26:37.71000:26:37.720 industry that can provide the world with 00:26:39.81000:26:39.820 its products and but address several of 00:26:43.08000:26:43.090 the environmental challenges that it 00:26:44.52000:26:44.530 faces over their coming years and 00:26:46.58000:26:46.590 including aspects of the United Nations 00:26:49.29000:26:49.300 sustainable development goals or SDGs 00:26:51.72000:26:51.730 and just calling out a couple of those 00:26:54.99000:26:55.000 specifically SD g7 to do renewable 00:26:58.29000:26:58.300 energy and s DG 13 to do with climate 00:27:00.57000:27:00.580 action are obvious ones for the IEA to 00:27:02.91000:27:02.920 until account and given our remit and 00:27:05.49000:27:05.500 clean energy and the energy sector 00:27:08.31000:27:08.320 accounting for the majority of 00:27:10.05000:27:10.060 anthropogenic co2 emissions but we also 00:27:12.51000:27:12.520 cast the net a bit wider in the spirit 00:27:14.46000:27:14.470 of the sustainable development scenario 00:27:16.05000:27:16.060 and look at broader aspects of the SDGs 00:27:20.18000:27:20.190 in this analysis specifically and that 00:27:23.49000:27:23.500 translates into the consideration of air 00:27:25.35000:27:25.360 pollutants water pollutants in the form 00:27:27.57000:27:27.580 of plastic pollution and water demand 00:27:30.87000:27:30.880 alongside 00:27:31.80000:27:31.810 co2 and here we have the RTS results the 00:27:36.24000:27:36.250 reference or baseline results and then 00:27:41.25000:27:41.260 there's cts results and the 00:27:42.78000:27:42.790 environmental impacts of this scenario 00:27:46.02000:27:46.030 decline rapidly by 2050 air pollution 00:27:49.62000:27:49.630 declines by 85% water pollutants and 00:27:52.92000:27:52.930 former plastic pollution by more than 90 00:27:54.84000:27:54.850 percent and co2 emissions around 45% 00:27:57.69000:27:57.700 lower 00:27:58.69000:27:58.700 in 2050 than they are in today and the 00:28:03.34000:28:03.350 next few slides take a look at a deeper 00:28:05.71000:28:05.720 look at how that's how that's achieved 00:28:10.11000:28:10.120 so the first element of context looked 00:28:13.00000:28:13.010 at in the CTS is the CTS of the clean 00:28:15.73000:28:15.740 technology scenario 5 if I wasn't clear 00:28:18.34000:28:18.350 about that CTS and RTS and so the first 00:28:21.58000:28:21.590 element of context to look at is the 00:28:23.08000:28:23.090 demand for primary chemicals and the 00:28:25.03000:28:25.040 role of recycling in reducing the demand 00:28:27.28000:28:27.290 for primary chemicals so demand for 00:28:31.06000:28:31.070 plastics can be satisfied either by 00:28:32.53000:28:32.540 primary production from oil and gas and 00:28:34.33000:28:34.340 or it can be satisfied by recycling 00:28:37.21000:28:37.220 existing plastic products and therefore 00:28:39.85000:28:39.860 not adding two additional primary 00:28:41.80000:28:41.810 chemical demand the purple bars on this 00:28:45.43000:28:45.440 slide show the dramatic increases in 00:28:46.96000:28:46.970 secondary production that take place in 00:28:48.61000:28:48.620 the CTS relative to the blue bars in the 00:28:51.58000:28:51.590 RTS the red dots overlaying the bars 00:28:54.82000:28:54.830 show both the average and the range of 00:28:57.28000:28:57.290 recycling rates this is collection rates 00:28:59.71000:28:59.720 across the resins that we analyzed and 00:29:02.77000:29:02.780 the resins that we analyzed were shown 00:29:04.06000:29:04.070 in that first very colorful graph in the 00:29:07.57000:29:07.580 in the RTS section I can go back to that 00:29:10.12000:29:10.130 later if you if you'd like to look at a 00:29:11.71000:29:11.720 more and then finally the green bars 00:29:14.26000:29:14.270 show the resulting primary chemical 00:29:15.82000:29:15.830 savings from these increases in in 00:29:18.01000:29:18.020 collection rates and this the results of 00:29:23.41000:29:23.420 the CTS are more than 70 million tons of 00:29:25.96000:29:25.970 primary chemical savings by 2050 or 00:29:28.54000:29:28.550 around half of today's plastic 00:29:32.08000:29:32.090 production taking place by secondary 00:29:33.76000:29:33.770 routes so plastic recycling also has a 00:29:38.89000:29:38.900 big impact on oil demand for 00:29:40.21000:29:40.220 petrochemical feedstock and high 00:29:42.40000:29:42.410 recycling rates in this in the CTS 00:29:44.41000:29:44.420 reduces oil demand for feedstock by 2.4 00:29:46.87000:29:46.880 MBD by 2050 00:29:48.79000:29:48.800 however oil demand for chemical 00:29:50.74000:29:50.750 feedstock in the CTS in the context of 00:29:52.81000:29:52.820 declining demand or stagnating demand in 00:29:56.08000:29:56.090 other sectors still grows by 3.6 MBD 00:29:59.28000:29:59.290 reaching more than 15 MBD in 2050 if the 00:30:04.81000:30:04.820 share of chemical feedstock in total 00:30:06.82000:30:06.830 demand in the CCS is actually much 00:30:08.53000:30:08.540 higher than in the RTS and that might be 00:30:11.05000:30:11.060 intuitive to a lot see 00:30:12.43000:30:12.440 but that's an interesting finding for us 00:30:14.68000:30:14.690 and and by 2050 petrochemicals their 00:30:19.51000:30:19.520 account for more than a quarter of the 00:30:20.95000:30:20.960 global total for oil demand in this 00:30:23.35000:30:23.360 clean technology scenario much higher 00:30:25.51000:30:25.520 than their roughly 16 percent in there 00:30:27.94000:30:27.950 in the end the reference technologies 00:30:30.04000:30:30.050 tonight and just to reinforce this point 00:30:36.55000:30:36.560 about the new oil demand dynamics in the 00:30:38.38000:30:38.390 in the clean technologies scenario and 00:30:39.88000:30:39.890 whether this is an interesting finding 00:30:42.16000:30:42.170 that we were able to pull out and here 00:30:45.19000:30:45.200 we have some regional per capita figures 00:30:47.11000:30:47.120 for oil demand for row passenger 00:30:48.46000:30:48.470 transport and then also for plastic 00:30:50.89000:30:50.900 consumption add the oil required to 00:30:52.87000:30:52.880 satisfy plastic consumption today in the 00:30:56.26000:30:56.270 US and the EU per capita oil demand for 00:30:58.60000:30:58.610 a passenger transport is between two and 00:31:01.06000:31:01.070 five times as much as four plastic 00:31:03.01000:31:03.020 consumption in China and India the ratio 00:31:06.34000:31:06.350 is smaller but Road passenger transport 00:31:08.29000:31:08.300 still eclipses that four and the oil 00:31:10.42000:31:10.430 demand for a passenger transport still 00:31:11.89000:31:11.900 eclipses that for plastic consumption so 00:31:16.15000:31:16.160 this interesting feature of the CTS is 00:31:17.92000:31:17.930 that on all four of these regions per 00:31:19.57000:31:19.580 capita order oil demand for plastic 00:31:21.46000:31:21.470 consumption overtakes that four row 00:31:23.11000:31:23.120 passenger transport by 2050 and 00:31:26.64000:31:26.650 petrochemicals as I've said before 00:31:28.36000:31:28.370 whether I become the largest sector of 00:31:30.40000:31:30.410 oil demand reaching a more than fifteen 00:31:34.63000:31:34.640 MBD far higher than their seven MBD for 00:31:38.35000:31:38.360 Road passenger transport so despite this 00:31:44.64000:31:44.650 continuing growth in oil consumption in 00:31:47.29000:31:47.300 the CTS emissions declined by about 00:31:49.15000:31:49.160 forty five percent 00:31:50.23000:31:50.240 showed on the environmental side the 00:31:53.08000:31:53.090 introduction to the environment of slide 00:31:54.43000:31:54.440 and forty five percent relative to 00:31:58.12000:31:58.130 today's levels and this represents a 00:32:01.63000:32:01.640 sixty percent decline relative to the 00:32:03.61000:32:03.620 RTS in 2050 where it would have gone or 00:32:06.54000:32:06.550 25 percent cumulative reduction in co2 00:32:09.58000:32:09.590 emissions during the analysis period so 00:32:13.21000:32:13.220 how can older man keep rising and 00:32:14.71000:32:14.720 emissions go down well one of the 00:32:17.35000:32:17.360 reasons goes back to the feedstock 00:32:18.69000:32:18.700 element that a lot of this oil is 00:32:20.62000:32:20.630 actually being embedded and physically 00:32:22.45000:32:22.460 and chemical products but then there are 00:32:24.61000:32:24.620 also other things taking 00:32:25.89000:32:25.900 in the CTS that drive emissions down 00:32:28.31000:32:28.320 sorry that's the cumulative emissions 00:32:30.27000:32:30.280 there in the yellow yellow dots 00:32:32.66000:32:32.670 cumulative emissions savings rather so 00:32:37.41000:32:37.420 we've have grouped the emission savings 00:32:39.87000:32:39.880 by lever here in this pie chart this is 00:32:42.00000:32:42.010 all available in more detail in the 00:32:43.77000:32:43.780 report but there are five main 00:32:45.72000:32:45.730 categories carbon capture and 00:32:47.31000:32:47.320 utilization and storage SEC US coal to 00:32:51.57000:32:51.580 natural gas feedstock shifts which is a 00:32:53.25000:32:53.260 particular with particularly relevant in 00:32:55.20000:32:55.210 China energy efficiency plastic 00:32:58.53000:32:58.540 recycling and the use of alternative 00:33:00.57000:33:00.580 feedstocks and you can show the you can 00:33:03.24000:33:03.250 see the shares there in cumulative 00:33:05.01000:33:05.020 emissions savings terms CC us does there 00:33:08.85000:33:08.860 does the heavy lifting on the emission 00:33:10.65000:33:10.660 savings front and the chemical sector 00:33:12.84000:33:12.850 represents some of the lowest cost 00:33:14.63000:33:14.640 applications for CC us and in the energy 00:33:18.33000:33:18.340 system and it is hard for according to 00:33:21.18000:33:21.190 our modeling it's hard for alternative 00:33:22.86000:33:22.870 feedstocks to compete with these 00:33:24.63000:33:24.640 relatively low cost opportunities for CC 00:33:26.91000:33:26.920 us when I talk about alternative 00:33:30.18000:33:30.190 feedstocks we're gonna have one more 00:33:31.56000:33:31.570 slide on this after this but it's we're 00:33:33.60000:33:33.610 talking predominately about bioenergy 00:33:35.13000:33:35.140 and electrolytic hydrogen energy 00:33:39.75000:33:39.760 efficiency both from a continuous 00:33:41.39000:33:41.400 improvement point of view so the 00:33:43.89000:33:43.900 specific energy consumption of process 00:33:46.08000:33:46.090 units improving gradually over time but 00:33:48.24000:33:48.250 also from fundamental process shifts to 00:33:51.33000:33:51.340 just process routes that are more energy 00:33:54.60000:33:54.610 efficient inherently they deliver about 00:33:56.88000:33:56.890 these shifts deliver around a quarter of 00:33:58.65000:33:58.660 the savings and then coal to natural gas 00:34:01.02000:34:01.030 shifts so reducing the process emissions 00:34:03.63000:34:03.640 resulting from producing primary 00:34:05.31000:34:05.320 chemicals gives a yields about another 00:34:07.56000:34:07.570 quarter ambitious increases in recycling 00:34:12.06000:34:12.070 that I showed on the previous slides 00:34:14.09000:34:14.100 deliver around nine percent of the 00:34:16.91900:34:16.929 cumulative emissions savings and this is 00:34:18.96000:34:18.970 as a result of having to produce fewer 00:34:20.90900:34:20.919 primary chemicals 00:34:25.56000:34:25.570 and so just to provide a bit more detail 00:34:28.41000:34:28.420 here on the key emissions lever in the 00:34:31.41000:34:31.420 city in the city s which is CC us the 00:34:36.15000:34:36.160 chemical sector hosts the largest CCU 00:34:38.43000:34:38.440 application that's around today which is 00:34:40.92000:34:40.930 the use of co2 concentrated co2 streams 00:34:45.21000:34:45.220 from ammonia production as feedstock for 00:34:47.07000:34:47.080 urea production so when people talk 00:34:49.38000:34:49.390 about CCU and all of their future 00:34:51.00000:34:51.010 applications this is by far the largest 00:34:52.92000:34:52.930 one that happens today however this is a 00:34:56.43000:34:56.440 temporary storage mechanism co2 from 00:34:59.37000:34:59.380 urea that becomes embedded from ammonia 00:35:02.04000:35:02.050 production is then released downstream 00:35:04.56000:35:04.570 when urea is applied to fields and this 00:35:08.04000:35:08.050 is the urea to come decomposes and the 00:35:10.47000:35:10.480 co2 molecule is released so this is only 00:35:12.51000:35:12.520 a temporary application but it's 00:35:14.01000:35:14.020 important to consider it in the chemical 00:35:15.54000:35:15.550 sector modelling because you don't 00:35:17.10000:35:17.110 overestimate the cheap sources of co2 00:35:20.88000:35:20.890 capture for storage by 2050 though 00:35:25.68000:35:25.690 capture for permanent storage overtakes 00:35:27.75000:35:27.760 the current application of utilization 00:35:30.12000:35:30.130 and with around 220 million tons per 00:35:33.51000:35:33.520 year being stored and been captured and 00:35:37.02000:35:37.030 stored permanently and and so this means 00:35:40.71000:35:40.720 by 2050 again that 35 percent of 00:35:43.23000:35:43.240 emissions generated in the sector are 00:35:45.12000:35:45.130 being captured or utilized by 2050 it's 00:35:52.11000:35:52.120 a lot of a lot of dots there but shows 00:35:54.12000:35:54.130 the the the rate of utilization and 00:35:57.00000:35:57.010 storage in each year in each scenario 00:36:02.09000:36:02.100 now I wanted to touch on one of the key 00:36:04.95000:36:04.960 environmental problems that's garnering 00:36:06.48000:36:06.490 a lot of attention around the world and 00:36:07.92000:36:07.930 to do with the energy system more 00:36:09.27000:36:09.280 broadly but it it relates quite clearly 00:36:11.55000:36:11.560 to the chemical and petrochemical sector 00:36:12.96000:36:12.970 or its product and that's plastic 00:36:15.74000:36:15.750 leakage into the world's oceans 00:36:18.59000:36:18.600 when disposed of improperly plastics can 00:36:21.51000:36:21.520 and they do make their way into 00:36:23.22000:36:23.230 waterways and eventually into the ocean 00:36:25.23000:36:25.240 indirectly or directly and when they do 00:36:28.17000:36:28.180 they can get broken down by sunlight 00:36:29.76000:36:29.770 into tiny particles which there many 00:36:31.62000:36:31.630 fish and other animals can ingest 00:36:33.57000:36:33.580 mistake for food in the RTS the base 00:36:37.38000:36:37.390 scenario with no current 00:36:39.15000:36:39.160 firm commitments and coordinated across 00:36:41.52000:36:41.530 multiple jurisdictions which which is 00:36:43.92000:36:43.930 one of the things we think it will take 00:36:45.84000:36:45.850 and with none of those commitments they 00:36:49.58000:36:49.590 established a cumulative waist 00:36:52.91000:36:52.920 accumulative plastic waste leakage into 00:36:55.32000:36:55.330 the world's ocean increases more than 00:36:57.60000:36:57.610 tenfold over the over the scenario 00:37:00.18000:37:00.190 horizon in the CTS rapid and broad-based 00:37:05.64000:37:05.650 improvements in waste management to 00:37:07.14000:37:07.150 facilitate this near tripling in 00:37:08.91000:37:08.920 collection rates that occurs in the CTS 00:37:10.77000:37:10.780 lays the groundwork to dramatically 00:37:13.26000:37:13.270 reduce the cumulative waste that's 00:37:15.30000:37:15.310 flowing into the world's oceans and I 00:37:18.54000:37:18.550 should mention that this doesn't take 00:37:19.71000:37:19.720 into account any efforts to remove 00:37:22.14000:37:22.150 plastic waste from the oceans this is 00:37:23.67000:37:23.680 additions to to plastic waste leakage so 00:37:30.51000:37:30.520 our analysis of investments associated 00:37:33.24000:37:33.250 with primary chemical production shows 00:37:34.95000:37:34.960 that the the CTS are clean technology 00:37:37.38000:37:37.390 scenario can be pursued cost-effectively 00:37:39.33000:37:39.340 and recycling and coal to gas feedstock 00:37:42.75000:37:42.760 shifts in the CTS mean that cumulative 00:37:44.72000:37:44.730 capital investment required is actually 00:37:46.83000:37:46.840 lower in the clean technology scenario 00:37:48.69000:37:48.700 than in their reference technology 00:37:50.04000:37:50.050 scenario which is often surprising 00:37:52.74000:37:52.750 finding and this is because recycling 00:37:57.33000:37:57.340 means that you have to lowers demand for 00:38:00.03000:38:00.040 primary chemicals and means you have to 00:38:01.62000:38:01.630 build less expensive pieces of equipment 00:38:05.16000:38:05.170 like steam crackers that cost a lot of 00:38:06.96000:38:06.970 money and and also no second component 00:38:11.01000:38:11.020 this coal to gas feedstock shifting the 00:38:13.20000:38:13.210 capital intensity of coal based chemical 00:38:15.78000:38:15.790 production is generally higher than 00:38:17.19000:38:17.200 those utilizing gaseous and liquid 00:38:19.83000:38:19.840 feedstocks so shifting away brings in 00:38:23.07000:38:23.080 environmental benefit and also reduces 00:38:25.32000:38:25.330 the capex 00:38:26.30000:38:26.310 required and these savings from these 00:38:31.41000:38:31.420 two key but these two key elements of 00:38:34.83000:38:34.840 savings offset the costs that are 00:38:37.62000:38:37.630 required for additional storage cap 00:38:40.14000:38:40.150 carbon capture and storage equipment or 00:38:41.88000:38:41.890 Kelvin capture equipment is the 00:38:43.68000:38:43.690 investment that takes place in the 00:38:44.94000:38:44.950 chemical sector 00:38:48.65000:38:48.660 so this last graphic displays some 00:38:51.27000:38:51.280 results from an off model analysis that 00:38:53.31000:38:53.320 we performed to examine his alternative 00:38:55.77000:38:55.780 feedstock routes in greater detail 00:38:57.39000:38:57.400 because they didn't come through as much 00:38:58.95000:38:58.960 in now in our modeling they didn't prove 00:39:01.71000:39:01.720 as cost-effective a cost effective as CC 00:39:04.20000:39:04.210 us and their modeling so we wanted to 00:39:05.79000:39:05.800 take a bit of a more detailed look and 00:39:07.70000:39:07.710 and I should stress that this these 00:39:10.32000:39:10.330 results don't form part of the CTS but 00:39:12.66000:39:12.670 they were kind of a side a side analysis 00:39:14.58000:39:14.590 that we did so feedstocks were produced 00:39:18.63000:39:18.640 from a carbon neutral energy source the 00:39:20.88000:39:20.890 the benefits would be the elimination of 00:39:22.71000:39:22.720 downstream additional missions and and 00:39:26.40000:39:26.410 if products are oxidized during use or 00:39:29.01000:39:29.020 disposal these emissions would either be 00:39:31.44000:39:31.450 neutral or they would would would not 00:39:33.90000:39:33.910 occur and also theoretically the 00:39:37.89000:39:37.900 chemical sector could then move away 00:39:39.39000:39:39.400 from using fossil fuel feedstocks and 00:39:41.79000:39:41.800 fossil fuels altogether so firstly we 00:39:44.76000:39:44.770 looked at a bioenergy only pathway and 00:39:47.04000:39:47.050 this entails producing ammonia and 00:39:49.14000:39:49.150 methanol directly from bioenergy via 00:39:51.36000:39:51.370 gasification and and ethylene from bio 00:39:54.78000:39:54.790 ethanol via dehydration and then the 00:39:57.90000:39:57.910 propylene and the aromatics for which 00:39:59.61000:39:59.620 there are not direct commercial routes 00:40:01.20000:40:01.210 available at the moment or direct proven 00:40:03.90000:40:03.910 scaled routes and methanol to olefin to 00:40:07.17000:40:07.180 methanol to aromatics are used to come 00:40:08.91000:40:08.920 up to convert methanol into propylene 00:40:11.91000:40:11.920 aromatics and then secondly we looked at 00:40:15.42000:40:15.430 electricity only pathways so this is 00:40:17.46000:40:17.470 using electrolysis water electrolysis to 00:40:20.37000:40:20.380 produce methanol and ammonia directly 00:40:23.01000:40:23.020 and then again using the methanol to 00:40:25.17000:40:25.180 olefin x' and methanol to aromatics 00:40:26.49000:40:26.500 processes to convert methanol into the 00:40:29.82000:40:29.830 olefins and aromatics that are required 00:40:31.98000:40:31.990 in the CTS the CTS demand projections 00:40:36.21000:40:36.220 were used for this side analysis that's 00:40:38.76000:40:38.770 why the CTS crops up so the results are 00:40:43.65000:40:43.660 pretty stark by 2050 the bioenergy 00:40:45.63000:40:45.640 pathway requires nearly eight times the 00:40:47.76000:40:47.770 bioenergy amount for all industry in a 00:40:49.74000:40:49.750 similar low carbon pathway and in a an 00:40:52.17000:40:52.180 SDS type world and in the electricity 00:40:55.68000:40:55.690 pathway the demand for electricity 00:40:57.18000:40:57.190 exceeds that for all industry and by 25 00:41:01.17000:41:01.180 percent 00:41:02.15000:41:02.160 again in a in a similar SDS type pathway 00:41:05.40000:41:05.410 for industry in 2050 and this is 00:41:09.75000:41:09.760 significant because industry is a very 00:41:11.52000:41:11.530 large electricity consumer and there are 00:41:15.30000:41:15.310 other challenges that are explored more 00:41:17.40000:41:17.410 in the book in these to do with these 00:41:19.05000:41:19.060 electricity and bioenergy only pathways 00:41:21.27000:41:21.280 to do with water demand and the large 00:41:23.22000:41:23.230 amount of co2 required for the 00:41:24.93000:41:24.940 electricity pathway in in a world that 00:41:28.65000:41:28.660 you would imagine would be fairly 00:41:30.00000:41:30.010 heavily decarbonized by that point and 00:41:32.18000:41:32.190 just to draw attention to the the dashed 00:41:34.65000:41:34.660 bars and which are very faint on the 00:41:37.05000:41:37.060 screen but the dash bars show the 00:41:38.82000:41:38.830 additional energy requirements were all 00:41:41.25000:41:41.260 of the chemicals that are currently 00:41:42.81000:41:42.820 being produced in refineries were also 00:41:44.84900:41:44.859 produced by these routes it might be a 00:41:47.58000:41:47.590 bit odd to have oil refineries still 00:41:50.64000:41:50.650 going but your entire chemical industry 00:41:52.68000:41:52.690 not utilizing fossil fuels so we we 00:41:55.32000:41:55.330 wanted to get some idea of what the 00:41:58.17000:41:58.180 total shift would require so now 00:42:04.74000:42:04.750 returning back to the CTS and the policy 00:42:06.99000:42:07.000 recommendations that we we think would 00:42:10.32000:42:10.330 be required to to get us there or some 00:42:12.81000:42:12.820 of them we divided these top ten 00:42:15.32900:42:15.339 recommendations into two groups and the 00:42:17.60900:42:17.619 first set is more associated with the 00:42:19.98000:42:19.990 production of primary chemicals whereas 00:42:21.99000:42:22.000 the second set is to do with their use 00:42:23.91000:42:23.920 and disposal of chemical products and so 00:42:28.38000:42:28.390 we have some I don't use too much time 00:42:31.68000:42:31.690 we can discuss discuss these in more 00:42:33.63000:42:33.640 detail on there and they're written down 00:42:34.89000:42:34.900 here but and these I think these first 00:42:37.92000:42:37.930 five recommendations will be quite 00:42:39.30000:42:39.310 familiar to those who read in-depth IEA 00:42:42.32900:42:42.339 reports about specific industrial 00:42:44.55000:42:44.560 sectors and we need to stimulate R&D to 00:42:48.78000:42:48.790 to develop and scale up the sustainable 00:42:51.96000:42:51.970 chemical processes and we need to 00:42:54.54000:42:54.550 establish benchmarking schemes for 00:42:58.68000:42:58.690 energy efficiency or extend them where 00:43:01.05000:43:01.060 they exist already we need to pursue a 00:43:05.87000:43:05.880 effective regulatory mechanisms for 00:43:08.57000:43:08.580 reducing co2 emissions 00:43:10.44000:43:10.450 whether it be taxation pricing etc and 00:43:13.62000:43:13.630 these these are more 00:43:14.55000:43:14.560 these are broader things that apply to 00:43:16.14000:43:16.150 other elements of the energy system as 00:43:18.00000:43:18.010 well and we need to require industry to 00:43:21.51000:43:21.520 meet stringent air quality standards 00:43:23.55000:43:23.560 like those of the World Health 00:43:24.39000:43:24.400 Organization and and also ensure that 00:43:28.71000:43:28.720 fuel and feedstock prices reflect their 00:43:30.72000:43:30.730 actual market value and there there's 00:43:34.86000:43:34.870 some of the externalities that are 00:43:36.30000:43:36.310 associated with using them as opposed to 00:43:38.07000:43:38.080 other feedstocks and then more to do 00:43:42.96000:43:42.970 with the use and disposal of chemical 00:43:45.09000:43:45.100 products and these are perhaps less 00:43:47.58000:43:47.590 familiar sorry I've skipped one slide 00:43:49.41000:43:49.420 there M so we've got things like 00:43:51.48000:43:51.490 reducing reliance on single-use plastics 00:43:53.61000:43:53.620 other than for non essential non 00:43:55.74000:43:55.750 substitutable purposes in very important 00:44:00.03000:44:00.040 that one number seven about improving 00:44:01.89000:44:01.900 waste management infrastructure both to 00:44:04.58000:44:04.590 enable the great dramatic increases in 00:44:06.96000:44:06.970 recycling that take place in the CTS but 00:44:08.88000:44:08.890 also the added benefits of reducing 00:44:11.70000:44:11.710 plastic leakage raising consumer 00:44:15.81000:44:15.820 awareness about recycling and other 00:44:17.76000:44:17.770 important demand side measures and 00:44:20.66000:44:20.670 designing products and incentivizing 00:44:23.16000:44:23.170 designers to design products with 00:44:25.29000:44:25.300 disposal in mind so making them easier 00:44:27.00000:44:27.010 to recycle easier to collect and then 00:44:29.78000:44:29.790 initiatives to extend producer 00:44:31.77000:44:31.780 responsibility incentives to extend 00:44:34.52000:44:34.530 business models and other schemes that 00:44:37.29000:44:37.300 extend the producers responsibility 00:44:39.62000:44:39.630 beyond the factory gate and that's it my 00:44:44.76000:44:44.770 conclusions are there but I don't think 00:44:46.62000:44:46.630 I'm going to read these out these are 00:44:47.73000:44:47.740 more or less the high-level themes of 00:44:49.89000:44:49.900 the talk so we can leave those up there 00:44:51.48000:44:51.490 for discussion thank you very much 00:44:59.03000:44:59.040 thanks so much Peter that was was really 00:45:01.55900:45:01.569 interesting again for those watching 00:45:03.45000:45:03.460 online and listening to the podcast my 00:45:05.76000:45:05.770 name is Katherine Spector and I'm here 00:45:07.74000:45:07.750 with Peter Levi energy analyst at IEA 00:45:10.95000:45:10.960 and Co lead author of this report that 00:45:13.26000:45:13.270 we've been discussing the IEA report in 00:45:15.51000:45:15.520 the future petrochemicals we're also 00:45:17.06900:45:17.079 going to be come on up Jason we're gonna 00:45:20.09900:45:20.109 be joined by Jason board aauggh who is 00:45:22.65000:45:22.660 of course our founding director of the 00:45:24.39000:45:24.400 center on global energy policy I would 00:45:31.55900:45:31.569 just like to remind any of you who may 00:45:35.57900:45:35.589 have questions if you're in the audience 00:45:37.19000:45:37.200 we're gonna do a little discussion here 00:45:39.18000:45:39.190 first but a Q&A time please feel free to 00:45:41.46000:45:41.470 come on up to the microphone and for 00:45:44.13000:45:44.140 those of you watching online again you 00:45:45.63000:45:45.640 can use the hashtag cge key events to 00:45:49.41000:45:49.420 ask a question or our twitter handle at 00:45:51.68000:45:51.690 columbia you energy to ask a question if 00:45:54.90000:45:54.910 you are not in the room 00:45:57.12000:45:57.130 I mean join me at the table I think but 00:46:00.96000:46:00.970 Jason just speaking can I ask you to 00:46:02.73000:46:02.740 just share your thoughts on this report 00:46:05.91000:46:05.920 and the future of petrochemicals yeah 00:46:08.81900:46:08.829 well sure this is great I appreciate the 00:46:10.94000:46:10.950 Peters being here and the work the IEA 00:46:13.68000:46:13.690 did on this I think it's a really 00:46:14.60900:46:14.619 important question I don't have unique 00:46:16.62000:46:16.630 insights into the answer about the 00:46:18.12000:46:18.130 future of petrochemicals but I think 00:46:19.38000:46:19.390 it's really an important piece of work 00:46:21.27000:46:21.280 because I don't think that the role of 00:46:23.19000:46:23.200 petrochemicals play in the co2 mix is 00:46:26.40000:46:26.410 often well understood and in the outlook 00:46:28.47000:46:28.480 for oil demand is often well understood 00:46:30.59900:46:30.609 and those two things don't necessarily 00:46:32.88000:46:32.890 line up one to one in petrochemicals the 00:46:35.76000:46:35.770 way they do when we think about oil use 00:46:37.82900:46:37.839 when it's combusted in the 00:46:39.05900:46:39.069 transportation sector so I think that's 00:46:41.64000:46:41.650 and that's something that we're at the 00:46:43.17000:46:43.180 energy center focused on antwuan half 00:46:45.99000:46:46.000 just walked in who is our resident oil 00:46:50.24000:46:50.250 market expert at the center and is doing 00:46:52.85900:46:52.869 a lot of work with Katherine and with 00:46:54.24000:46:54.250 Mary and Colin some others on the future 00:46:55.89000:46:55.900 of oil demand and that is a pretty huge 00:46:58.77000:46:58.780 ly important question for the climate 00:47:00.53900:47:00.549 for oil markets and gets I think 00:47:03.05900:47:03.069 sometimes superficial treatment because 00:47:05.78900:47:05.799 people get quite understandably and 00:47:08.19000:47:08.200 rightfully excited about some of 00:47:09.63000:47:09.640 progress we've seen with electric 00:47:11.81900:47:11.829 vehicles still quite a small share of 00:47:13.95000:47:13.960 the total so even small very large 00:47:16.38000:47:16.390 growth rates take a long time to make a 00:47:18.69000:47:18.700 dent but then of course in passenger 00:47:22.65000:47:22.660 vehicles are still only 20 or 25% of 00:47:24.83900:47:24.849 global oil demand so thinking about how 00:47:26.70000:47:26.710 it looks in Freight or in maritime or in 00:47:29.88000:47:29.890 aviation or in petrochemicals is really 00:47:31.95000:47:31.960 important and that looks very different 00:47:33.26900:47:33.279 in different parts of the world so I 00:47:34.47000:47:34.480 think there's a really valuable 00:47:35.35900:47:35.369 contribution I just want to make sure I 00:47:38.66000:47:38.670 and so the takeaway from that I presume 00:47:41.03900:47:41.049 Peter is if people were to see numbers 00:47:44.84900:47:44.859 that show like a 5 hypothetically if we 00:47:47.67000:47:47.680 were to see very rapid growth of 00:47:48.80900:47:48.819 electric vehicles or something and you 00:47:50.19000:47:50.200 said well we're gonna see a 5 million 00:47:51.56900:47:51.579 barrel a day decline and oil demand as a 00:47:54.00000:47:54.010 result of the expansion of electric 00:47:55.34900:47:55.359 vehicle and a 5 million barrel a day 00:47:57.24000:47:57.250 growth because we're seeing rapid growth 00:47:59.91000:47:59.920 in the use of petrochemicals the 00:48:02.30900:48:02.319 immediate reaction might be well we 00:48:03.53900:48:03.549 haven't made any progress at all and in 00:48:05.16000:48:05.170 fact we would have from a co2 standpoint 00:48:07.01900:48:07.029 want to make sure that's correct - right 00:48:12.02900:48:12.039 no and yeah that I mean that is correct 00:48:15.69000:48:15.700 I think it's I think it's important 00:48:17.30900:48:17.319 though that we don't say that embedding 00:48:23.19000:48:23.200 oil in in petrochemicals is 100% good we 00:48:26.54900:48:26.559 have emissions that take place in the 00:48:28.58900:48:28.599 chemical sector that do stem from 00:48:30.26900:48:30.279 feedstock side process emissions 00:48:31.73000:48:31.740 although these are relatively small 00:48:33.66000:48:33.670 compared to the complete combustion of 00:48:35.70000:48:35.710 the fuels in the transport sector and 00:48:37.20000:48:37.210 then we also have these other pollution 00:48:39.08900:48:39.099 problems there sure yeah yeah those are 00:48:41.78900:48:41.799 really important I want to know my we 00:48:43.04900:48:43.059 should we understand like what problem 00:48:44.33900:48:44.349 we're addressing and what problem we're 00:48:45.96000:48:45.970 looking at and when you but for you you 00:48:49.58900:48:49.599 had you should process emissions and you 00:48:51.02900:48:51.039 showed energy related emissions so if we 00:48:53.03900:48:53.049 were to see progress in decarbonizing 00:48:54.72000:48:54.730 the energy system 00:48:56.09900:48:56.109 that presumably would change how we 00:48:58.95000:48:58.960 think about the co2 impact of growth and 00:49:02.51900:49:02.529 petrochemicals and what that would mean 00:49:05.06900:49:05.079 for the future of oil demand and yes so 00:49:08.84900:49:08.859 well I mean so the the energy related 00:49:11.13000:49:11.140 and process emissions that are a data 00:49:15.08900:49:15.099 shown on the on the chart are those that 00:49:18.39000:49:18.400 take place directly within the 00:49:19.58900:49:19.599 petrochemical sector so those those are 00:49:22.01900:49:22.029 not from 00:49:22.98000:49:22.990 Christie there's a there's a direct 00:49:24.84000:49:24.850 emissions within the chemical sector and 00:49:26.43000:49:26.440 a lot of those are from high temperature 00:49:28.85900:49:28.869 heat which is another challenging aspect 00:49:31.17000:49:31.180 of of decarbonisation that we've facing 00:49:33.99000:49:34.000 in in lots of industries but the 00:49:35.46000:49:35.470 chemical sectors no exception there and 00:49:38.31000:49:38.320 then the process emissions if you're 00:49:40.14000:49:40.150 using a fossil fuel feedstock and you're 00:49:42.45000:49:42.460 producing something with a lower carbon 00:49:44.37000:49:44.380 balance than what you put into it it's 00:49:47.03000:49:47.040 relatively it's difficult to get to get 00:49:49.89000:49:49.900 rid of those with the laws of 00:49:51.39000:49:51.400 stoichiometry 00:49:52.14000:49:52.150 but you've you've got obviously 00:49:55.13000:49:55.140 important measures that you can take 00:49:57.78000:49:57.790 with CC us and the other things we do 00:49:59.55000:49:59.560 which is why you look at CC us right 00:50:03.23000:50:03.240 solution and then you showed a chart 00:50:04.95000:50:04.960 she's trying to find it but you had one 00:50:06.78000:50:06.790 that showed like the different pathways 00:50:08.64000:50:08.650 in the sustainable scenario and what the 00:50:12.51000:50:12.520 sustainable development scenario or 00:50:14.10000:50:14.110 clean technology the decline the very 00:50:21.51000:50:21.520 steep decline in water pollution 00:50:23.25000:50:23.260 relative to what it would otherwise look 00:50:24.87000:50:24.880 like decline in air pollution and then 00:50:28.68000:50:28.690 in co2 00:50:29.49000:50:29.500 I was just wondering in that scenario 00:50:31.68000:50:31.690 what does oil demand look like in that 00:50:34.22000:50:34.230 clean technology scenario does that make 00:50:37.02000:50:37.030 sense yes so because it's not gonna 00:50:38.73000:50:38.740 decline as steeply I think sorry they 00:50:42.12000:50:42.130 well oil demands you show the growth in 00:50:44.88000:50:44.890 oil demand in the pet chem sector yeah 00:50:46.53000:50:46.540 and in the clean technology scenario 00:50:48.84000:50:48.850 what happens to the growth of oil 00:50:50.70000:50:50.710 how much does achieving that clean 00:50:52.92000:50:52.930 technology scenario affect oil demand in 00:50:56.67000:50:56.680 the petrochemical sector or are we 00:50:59.40000:50:59.410 achieving through through CC us and and 00:51:03.15000:51:03.160 and and other things and you obviously 00:51:04.23000:51:04.240 have embedded carbon as part of oil 00:51:05.88000:51:05.890 demand do we still see actually it 00:51:07.83000:51:07.840 doesn't hit oil demand that much to 00:51:10.05000:51:10.060 achieve the clean technology scenario 00:51:11.64000:51:11.650 does that make sense yes sorry and so 00:51:14.60900:51:14.619 the key the key difference in oil demand 00:51:17.46000:51:17.470 for the petrochemical sector between the 00:51:19.62000:51:19.630 two scenarios between the reference 00:51:20.84900:51:20.859 technologies now in the clean scenario 00:51:23.01000:51:23.020 clean technology scenario is the the 00:51:25.29000:51:25.300 impact of recycling on reducing demand 00:51:27.42000:51:27.430 for primary chemicals we assume the same 00:51:29.76000:51:29.770 demand for plastic materials but the way 00:51:32.49000:51:32.500 they're produced requires fewer primary 00:51:35.16000:51:35.170 chemicals and there 00:51:36.19000:51:36.200 or less oil uses feedstock you'd still 00:51:38.89000:51:38.900 see growth in oil demand for 00:51:41.02000:51:41.030 petrochemicals in the clean technologies 00:51:42.60900:51:42.619 yes we do I think at the exact figure I 00:51:45.70000:51:45.710 don't want every quite it wrong but it's 00:51:47.29000:51:47.300 shown on on one of the charts earlier in 00:51:49.30000:51:49.310 the presentation ok sorry no no no it's 00:51:52.69000:51:52.700 like I said I remember the growth in the 00:51:54.49000:51:54.500 reference case I think was 3.6 yeah 00:51:56.31900:51:56.329 absolutely there is still still growth 00:51:58.45000:51:58.460 and then it's its share in the global 00:52:01.99000:52:02.000 oil demand as shown on the on the 00:52:03.73000:52:03.740 right-hand axis and so there we're 00:52:06.09900:52:06.109 looking at around 15 million barrels per 00:52:07.90000:52:07.910 day in 2050 from around at 13 today 00:52:11.57900:52:11.589 right and sorry this just to clarify 00:52:14.47000:52:14.480 that this is feedstock so we're looking 00:52:16.75000:52:16.760 at eleven point seven today most of the 00:52:18.91000:52:18.920 oil that's consumed in the in sectors as 00:52:21.01000:52:21.020 feedstock but then there's a small 00:52:22.56900:52:22.579 amount for process energy and then I 00:52:24.22000:52:24.230 should have worn this like jacket that I 00:52:27.13000:52:27.140 forgot to wear that is made of recycled 00:52:28.81000:52:28.820 plastic from Adidas and I was wondering 00:52:31.69000:52:31.700 how much things like that matter so 00:52:33.40000:52:33.410 everyone's upset about we're gonna ban 00:52:35.07900:52:35.089 plastic straws and I shouldn't have a 00:52:37.06000:52:37.070 plastic bag when I go to the grocery 00:52:38.31900:52:38.329 store so we see the very visible things 00:52:39.97000:52:39.980 that we can do but as you said these 00:52:41.29000:52:41.300 chairs are made of it so we're worried 00:52:43.90000:52:43.910 about out plastic ocean pollution and 00:52:46.12000:52:46.130 we're taking steps that are visible to 00:52:48.60900:52:48.619 the consumer or like straws and plastic 00:52:50.47000:52:50.480 bags let's imagine we do all those 00:52:52.69000:52:52.700 things does that really matter 00:52:54.48000:52:54.490 well it certainly matters but it's 00:52:56.95000:52:56.960 definitely it doesn't produce as big an 00:52:59.17000:52:59.180 impact as as one might think so in there 00:53:01.69000:53:01.700 in the clean technology scenario we have 00:53:03.70000:53:03.710 we characterized the recycling rate as a 00:53:07.82900:53:07.839 combination of three factors which 00:53:10.18000:53:10.190 multiply and that's an important dynamic 00:53:12.55000:53:12.560 of recycling this not well understood I 00:53:15.43000:53:15.440 don't think so the first thing is how 00:53:17.53000:53:17.540 much of the available plastic waste that 00:53:19.48000:53:19.490 there is how much of it do you collect 00:53:21.30900:53:21.319 and that's the main thing that's quoted 00:53:23.47000:53:23.480 when we talk about recycling rate so 00:53:25.03000:53:25.040 when we we see very high recycling rates 00:53:26.92000:53:26.930 quoted in Germany Japan Korea and 00:53:29.55000:53:29.560 usually that's referring to the 00:53:31.30000:53:31.310 collection rate so that's factor number 00:53:33.79000:53:33.800 one and that could theoretically be a 00:53:35.65000:53:35.660 hundred percent of what's there simply 00:53:37.48000:53:37.490 you'd have to do a lot of sifting a lot 00:53:39.04000:53:39.050 of very careful sorting at the consumer 00:53:41.31900:53:41.329 end but you could potentially get all of 00:53:43.32900:53:43.339 it you then have the yield loss that 00:53:46.35900:53:46.369 takes place when you recycle and at the 00:53:48.67000:53:48.680 moment this is too 00:53:49.69000:53:49.700 clear twenty to thirty percent of the 00:53:52.33000:53:52.340 plastic that you collect that is that is 00:53:55.09000:53:55.100 you know dirty needs to be washed there 00:53:57.91000:53:57.920 needs to be melted reprocessed you lose 00:54:00.28000:54:00.290 twenty to thirty percent of it that can 00:54:01.99000:54:02.000 be improved but it won't be no loss in 00:54:04.75000:54:04.760 the future we we estimate and then the 00:54:07.42000:54:07.430 most important factor that is I don't 00:54:09.43000:54:09.440 think well understood at all 00:54:10.75000:54:10.760 is this the the extent to which recycled 00:54:15.22000:54:15.230 products can displace primary products 00:54:17.82000:54:17.830 so if when you if you recycle your PE 00:54:21.61000:54:21.620 body is polyethylene terephthalate 00:54:23.80000:54:23.810 and I hope and if you recycle it as is 00:54:28.09000:54:28.100 quite commonplace into polyethylene 00:54:30.31000:54:30.320 terephthalate fiber that's a one-time 00:54:33.01000:54:33.020 deal so you do that once in to make your 00:54:36.25000:54:36.260 once sure as a bracket and then and then 00:54:39.85000:54:39.860 it's a jacket forever and fiber 00:54:41.56000:54:41.570 recycling at the moment is very small 00:54:45.28000:54:45.290 scale where it exists at all it's a 00:54:47.47000:54:47.480 relatively limited Avenue for recycling 00:54:50.29000:54:50.300 at least with current technology so so 00:54:53.38000:54:53.390 this kind of gown cycling effect that we 00:54:55.27000:54:55.280 get from a lot of recycling is an 00:54:57.19000:54:57.200 important factor in that when you have 00:55:01.27000:55:01.280 very high recycling rates this doesn't 00:55:03.25000:55:03.260 necessarily mean huge one-for-one 00:55:05.71000:55:05.720 displacing of oil demand used to produce 00:55:08.23000:55:08.240 that original product I'm sorry if that 00:55:10.21000:55:10.220 is not sure if I explain that very well 00:55:11.95000:55:11.960 but those those three factors are 00:55:13.90000:55:13.910 important and the fact that they they 00:55:15.46000:55:15.470 multiply together is is I guess the way 00:55:18.85000:55:18.860 other way to say it is like if there is 00:55:20.32000:55:20.330 a people talk about like a backlash 00:55:23.53000:55:23.540 against plastic pollution and that tends 00:55:26.35000:55:26.360 to take the form of very tangible things 00:55:27.97000:55:27.980 like straws in plastic bags I'm 00:55:29.26000:55:29.270 oversimplifying you but if that takes if 00:55:31.69000:55:31.700 that becomes much more widespread I see 00:55:33.61000:55:33.620 it with students I see with my daughter 00:55:34.87000:55:34.880 I see it and that that is gaining 00:55:37.54000:55:37.550 traction if that becomes a norm if we 00:55:40.51000:55:40.520 see a cultural norm where no one's gonna 00:55:42.70000:55:42.710 people will look at you like something's 00:55:44.80000:55:44.810 wrong with you if you take a straw in a 00:55:46.24000:55:46.250 restaurant or a plastic bag in the store 00:55:47.86000:55:47.870 does that have much impact on your 00:55:50.65000:55:50.660 outlook for petrochemical demand for the 00:55:52.60000:55:52.610 oil sector so I mean single-use plastics 00:55:56.02000:55:56.030 is something that's used as a term that 00:55:58.06000:55:58.070 you use to refer to those types of 00:56:00.28000:56:00.290 applications quite a lot 00:56:01.69000:56:01.700 and there's no clear definition of that 00:56:03.82000:56:03.830 so whilst it you could we can definitely 00:56:06.40000:56:06.410 envisage a world in which we we don't 00:56:08.32000:56:08.330 use too many straws and there are lots 00:56:12.55000:56:12.560 of other plastics that are used once 00:56:13.93000:56:13.940 that are designed specifically because 00:56:15.58000:56:15.590 they can be used once so you've got 00:56:17.32000:56:17.330 medical equipment there's stuff like 00:56:19.90000:56:19.910 that nappies and lots of things that 00:56:21.70000:56:21.710 contain nobody's away sorry yeah and I'm 00:56:27.13000:56:27.140 sure not all of them contain 00:56:28.24000:56:28.250 petrochemicals but lots of products that 00:56:30.70000:56:30.710 we would find much harder to envisage or 00:56:33.63000:56:33.640 whimsically kind of get away from or 00:56:36.13000:56:36.140 change our behavior with and lots of 00:56:38.47000:56:38.480 single-use products are much harder and 00:56:40.63000:56:40.640 also this very limited firstly data but 00:56:44.98000:56:44.990 also even clear definition of what 00:56:47.02000:56:47.030 single-use plastics are and you'll see 00:56:49.33000:56:49.340 you'll see a few estimates out there we 00:56:51.13000:56:51.140 found a couple of other and I think some 00:56:55.03000:56:55.040 large oil companies have have made 00:56:57.22000:56:57.230 estimates of what single-use plastic 00:56:59.26000:56:59.270 demand will have as an impact on our 00:57:01.84000:57:01.850 demand and but we couldn't clarify the 00:57:06.07000:57:06.080 definition robustly enough for us to 00:57:08.02000:57:08.030 feel comfortable putting any numbers to 00:57:10.21000:57:10.220 that I think I've accidentally slipped 00:57:12.04000:57:12.050 into the moderator role since it's just 00:57:13.57000:57:13.580 a force of habit from but I'll turn it 00:57:15.96000:57:15.970 I'll be quiet now just like to sort of 00:57:20.44000:57:20.450 piggyback on that question about the 00:57:24.82000:57:24.830 scope for reducing initial use as 00:57:27.61000:57:27.620 opposed to recycling and one of the 00:57:31.33000:57:31.340 charts that I really liked and in the 00:57:33.19000:57:33.200 big report that was not in your 00:57:34.27000:57:34.280 presentation was one that looked at how 00:57:38.52000:57:38.530 both fertilizer demand and plastics 00:57:41.26000:57:41.270 demand grows with GDP per capita and 00:57:44.65000:57:44.660 it's not unlike charts I've seen for 00:57:47.05000:57:47.060 other types of oil where it grows 00:57:49.42000:57:49.430 extremely rapidly as GDP per capita 00:57:51.70000:57:51.710 starts to grow and and continues to grow 00:57:54.82000:57:54.830 but sort of plateaus at the very high 00:57:56.47000:57:56.480 income levels and it looks almost sort 00:57:58.30000:57:58.310 of logarithmic in that way so that sort 00:58:02.65000:58:02.660 of answers the income side of the 00:58:04.45000:58:04.460 question but when we think about initial 00:58:06.28000:58:06.290 use again as post recycling I'm curious 00:58:09.49000:58:09.500 if 00:58:10.02000:58:10.030 if you evaluate given a thought to the 00:58:13.23000:58:13.240 price sensitivity of demand whether in 00:58:16.47000:58:16.480 the emerging world or the developed 00:58:18.51000:58:18.520 world and I guess the sort of point of 00:58:21.93000:58:21.940 that question would then to be if if 00:58:23.79000:58:23.800 governments do decide that reducing 00:58:25.98000:58:25.990 consumption particularly if single-use 00:58:27.51000:58:27.520 plastic the policy goal would price be 00:58:30.72000:58:30.730 an effective lever or not really this 00:58:35.46000:58:35.470 the short answer in building demand 00:58:37.68000:58:37.690 projections for this work is not 00:58:40.74000:58:40.750 directly we haven't taken into account 00:58:44.18000:58:44.190 specific induce prices for plastic 00:58:46.80000:58:46.810 products one of the barriers to doing 00:58:49.44000:58:49.450 that at the moment is and you mentioned 00:58:51.39000:58:51.400 it in your introduction is that to get 00:58:54.63000:58:54.640 two primary plastic and fertilizer 00:58:59.01000:58:59.020 products to get even to data and 00:59:01.17000:59:01.180 consumption of those products this is 00:59:03.06000:59:03.070 before they're converted into consumer 00:59:06.51000:59:06.520 products and and other things and used 00:59:08.55000:59:08.560 as billion building materials that aside 00:59:10.71000:59:10.720 which is another step it's very very 00:59:13.29000:59:13.300 difficult to get decent data on the the 00:59:16.67000:59:16.680 ngos consumption of those things 00:59:18.81000:59:18.820 nevermind the prices at which they're 00:59:20.46000:59:20.470 consumed I mean I'm sure there we can 00:59:23.58000:59:23.590 make certain estimates but in terms of 00:59:26.22000:59:26.230 making a robust estimate of elasticity's 00:59:28.77000:59:28.780 and things like that we I'm afraid we're 00:59:30.57000:59:30.580 we're not at that stage with with this 00:59:32.37000:59:32.380 with this topic yet and I I feel that 00:59:36.48000:59:36.490 that's a fairly broadly faced challenge 00:59:40.41000:59:40.420 with this sector the the one of the 00:59:42.54000:59:42.550 really kind of exacerbating factors on 00:59:44.82000:59:44.830 that on the data front is the the 00:59:46.68000:59:46.690 multiple slices of trade that take place 00:59:48.96000:59:48.970 so you've got trade that we do take to 00:59:51.66000:59:51.670 try and take into account the potential 00:59:53.61000:59:53.620 for trade in the future at the primary 00:59:55.71000:59:55.720 chemical end and we talk to quite a lot 00:59:57.39000:59:57.400 about the various advantages that each 00:59:59.58000:59:59.590 region will face and the potential 01:00:02.61001:00:02.620 advantages that will provide for them as 01:00:04.71001:00:04.720 a as an export region for instance us 01:00:07.08001:00:07.090 middle east in the short term and and 01:00:09.45001:00:09.460 then the domestic drivers for that 01:00:11.40001:00:11.410 demand but then beyond their primary 01:00:14.73001:00:14.740 chemicals that we model all of the 01:00:17.06001:00:17.070 third-tier chemical chemicals that are 01:00:19.73001:00:19.740 in within the chemical sector and then 01:00:21.56001:00:21.570 the products that take that are made 01:00:23.27001:00:23.280 outside it the trade that happens in all 01:00:26.42001:00:26.430 at all of these levels is is phenomenal 01:00:29.63001:00:29.640 and it's it's much more complex 01:00:32.08001:00:32.090 potential e more complex as you go 01:00:34.28001:00:34.290 towards the consumer so that's that's 01:00:36.77001:00:36.780 our that's my excuse yeah it's it's 01:00:40.49001:00:40.500 tremendously challenging data wise I 01:00:42.20001:00:42.210 wonder if given the sort of mainstream 01:00:45.92001:00:45.930 attention to some of these issues we 01:00:47.66001:00:47.670 might start to get some case studies I 01:00:49.64001:00:49.650 think municipalities probably know what 01:00:52.37001:00:52.380 their waste collection and disposal 01:00:54.35001:00:54.360 costs are if that were somehow added as 01:00:57.74001:00:57.750 a tax or fee at least in sort of little 01:01:02.17001:01:02.180 microcosms we might start to be able to 01:01:04.46001:01:04.470 measure a demand response but it is a 01:01:07.28001:01:07.290 really overwhelming data problem it even 01:01:10.37001:01:10.380 a national level in the u.s. let alone a 01:01:12.08001:01:12.090 global level so that's really why this 01:01:15.08001:01:15.090 report as a starting point was was 01:01:17.09001:01:17.100 tremendously helpful I want to switch 01:01:20.45001:01:20.460 over to the the feedstocks for for just 01:01:22.88001:01:22.890 a minute because the other problem with 01:01:25.82001:01:25.830 this sector that I find a little bit 01:01:27.59001:01:27.600 overwhelming to wrap my head around is 01:01:29.24001:01:29.250 what the implications are for refiners 01:01:32.53001:01:32.540 we have a world where refiners are now 01:01:36.29001:01:36.300 looking down the barrel of reduced at 01:01:39.74001:01:39.750 least slower growing gasoline demand in 01:01:43.01001:01:43.020 many cases a slower growing a reduced 01:01:46.12001:01:46.130 heavy end residual fuel oil part of the 01:01:49.22001:01:49.230 barrel and eventually as you set a 01:01:52.10001:01:52.110 higher naphtha demand but in the 01:01:54.59001:01:54.600 meanwhile the competitiveness of ethane 01:01:57.62001:01:57.630 might might be a bit of a hurdle so what 01:02:02.75001:02:02.760 does a refiner to do when when you start 01:02:05.63001:02:05.640 to get these very sort of lopsided rates 01:02:08.51001:02:08.520 of growth in the different products how 01:02:11.84001:02:11.850 are they particularly going to get over 01:02:13.73001:02:13.740 that hump and and adjust we see a lot of 01:02:17.75001:02:17.760 companies and even countries sort of 01:02:19.58001:02:19.590 saying this is where it's at for us in 01:02:22.34001:02:22.350 terms of our future economics this is 01:02:24.11001:02:24.120 where we're going 01:02:25.68001:02:25.690 but if you could just maybe talk a 01:02:27.54001:02:27.550 little bit more about the challenges 01:02:28.83001:02:28.840 that refiners will face in the next sort 01:02:30.51001:02:30.520 of twenty to thirty years in in making 01:02:32.31001:02:32.320 this transition not absolutely so this 01:02:34.83001:02:34.840 is a topic we revisit at various points 01:02:37.38001:02:37.390 in the book and and in the in the 01:02:40.38001:02:40.390 reference case or the baseline scenario 01:02:42.17001:02:42.180 we we already see some of this tension 01:02:45.21001:02:45.220 in terms of the ratio of different 01:02:47.25001:02:47.260 weight products within the barrel 01:02:48.69001:02:48.700 getting out of sync with what it's 01:02:50.97001:02:50.980 traditionally been but then in the in 01:02:53.25001:02:53.260 the clean technology scenario this 01:02:54.51001:02:54.520 search this slide actually demonstrates 01:02:56.58001:02:56.590 it quite well most of those most of that 01:02:58.71001:02:58.720 blue bar most of that feedstock there is 01:03:01.10001:03:01.110 we we have Ethan and LPG and oil 01:03:04.62001:03:04.630 products in the ia and in our balances 01:03:06.81001:03:06.820 and these are even lighter the naphtha 01:03:09.21001:03:09.220 and then most of the rest is naphtha 01:03:11.16001:03:11.170 very small amount of gas or uses 01:03:13.44001:03:13.450 feedstock diesel and very small amounts 01:03:17.07001:03:17.080 of heavier products so so the the the 01:03:20.06001:03:20.070 imbalance becomes even more acute in the 01:03:22.89001:03:22.900 in a clean technology scenario given 01:03:25.29001:03:25.300 that gasoline diesel undergoing even 01:03:28.35001:03:28.360 more severe decline since donation so 01:03:31.70001:03:31.710 absolutely a key concept that we return 01:03:34.38001:03:34.390 to and and I think the CTS dynamics are 01:03:37.35001:03:37.360 there are the most interesting ones to 01:03:38.97001:03:38.980 look at in terms of what the refining 01:03:41.67001:03:41.680 industry might do about this or and 01:03:45.20001:03:45.210 welfare one thing is the the integration 01:03:48.75001:03:48.760 expert aspect that we touched on a bit 01:03:51.21001:03:51.220 in the talk that on there on the 01:03:52.95001:03:52.960 financial side as as the margins 01:03:55.13001:03:55.140 reducing in the traditional markets and 01:03:57.80001:03:57.810 trying to get step further down the 01:04:00.54001:04:00.550 value chain in the pet CEM sector to try 01:04:03.48001:04:03.490 and capture some of that margin that's 01:04:04.91001:04:04.920 being captured by chemical companies or 01:04:07.38001:04:07.390 only chemical chemical only companies 01:04:09.51001:04:09.520 and so that's one thing that we already 01:04:12.66001:04:12.670 observe happening and and then in the 01:04:15.12001:04:15.130 longer term the the dream technology and 01:04:18.87001:04:18.880 and in fact there is an existing plant 01:04:20.96001:04:20.970 today of so-called crude oil two 01:04:23.85001:04:23.860 chemicals 01:04:24.33001:04:24.340 I was going to ask you about that means 01:04:26.01001:04:26.020 Aramco is looking at it right and yeah 01:04:27.84001:04:27.850 and there's a there's an I think it's 01:04:30.14001:04:30.150 owned by run by Exxon there's a plant in 01:04:33.72001:04:33.730 Singapore today that's 01:04:36.77001:04:36.780 big I mean big ish 400 kilobytes per day 01:04:40.92001:04:40.930 and and there's the extent to which this 01:04:46.79901:04:46.809 is other technologies piece together so 01:04:50.91001:04:50.920 bits of pet chem facilities and bits of 01:04:53.33901:04:53.349 refineries stitch together I must 01:04:56.06901:04:56.079 confess that on the refining technology 01:04:58.23001:04:58.240 level we would be of great benefit to 01:05:01.55901:05:01.569 have Araceli the other lead author of 01:05:03.66001:05:03.670 the project here she's very experienced 01:05:05.67001:05:05.680 in the refining industry and that the 01:05:08.28001:05:08.290 yeah the extent to which these 01:05:09.56901:05:09.579 technologies are and piece pieces of of 01:05:12.72001:05:12.730 each industry stitch together and and 01:05:15.32901:05:15.339 not a full revolution in the way that 01:05:17.94001:05:17.950 oil is processed and leapfrogging this 01:05:20.91001:05:20.920 this this refining step that that's 01:05:24.05901:05:24.069 something that is set to evolve in this 01:05:27.21001:05:27.220 or will will need to evolve further if 01:05:29.16001:05:29.170 it's to fulfill the filfil ambition of 01:05:31.85901:05:31.869 the of the technology which is getting 01:05:35.76001:05:35.770 you know 70 to 80 percent yield of your 01:05:37.95001:05:37.960 crude into chemicals and this I think 01:05:41.94001:05:41.950 you need very light Croods to do this at 01:05:45.72001:05:45.730 the moment or or even just I mean like 01:05:48.96001:05:48.970 very condensate yeah so you're utilizing 01:05:52.31901:05:52.329 things that are already much closer to 01:05:54.39001:05:54.400 the to the feedstocks that we might be 01:05:55.98001:05:55.990 short of later and one other components 01:05:59.73001:05:59.740 mentioned on this front is that the the 01:06:02.00001:06:02.010 the lighter crude supply that's coming 01:06:06.35901:06:06.369 from the and NGOs from the shale shale 01:06:10.82901:06:10.839 gas revolution are in to some extent and 01:06:14.08901:06:14.099 looking like they will fill some of this 01:06:16.76001:06:16.770 additional light product gap in the 01:06:19.74001:06:19.750 short to medium term but as we as the we 01:06:23.91001:06:23.920 see the ngl supply tightening in the in 01:06:27.00001:06:27.010 the latter half of the movie and based 01:06:30.42001:06:30.430 on current projections of output from 01:06:32.40001:06:32.410 the US that's when the challenge will 01:06:34.65001:06:34.660 start to really ramp up according to 01:06:37.15001:06:37.160 I'm only sure before we open things up 01:06:41.47001:06:41.480 to the audience Jason Giovanni okay 01:06:43.72001:06:43.730 again if if you're in the room here 01:06:46.12001:06:46.130 please feel free to step to the 01:06:47.52901:06:47.539 microphone and for folks listening again 01:06:50.44001:06:50.450 if you'd like to ask a question 01:06:53.09901:06:53.109 virtually the hashtag to do that is si 01:06:56.02001:06:56.030 GE P events and our twitter handle is at 01:06:58.83901:06:58.849 Columbia Hugh Energy I would like to 01:07:06.59901:07:06.609 thank you very much for an excellent 01:07:08.98001:07:08.990 presentation on your report I'd like to 01:07:12.40001:07:12.410 ask two big-picture questions one is I'm 01:07:17.77001:07:17.780 thinking about this from the point of 01:07:19.35901:07:19.369 view of alternatives to oil and gas and 01:07:23.16001:07:23.170 thinking of the consuming sectors and 01:07:26.02001:07:26.030 obviously power generation is under 01:07:29.58901:07:29.599 attack if you will with alternatives to 01:07:31.90001:07:31.910 what we have now whether it's renewables 01:07:34.56901:07:34.579 or nuclear or other ideas which are 01:07:38.04901:07:38.059 going to lower obviously they have 01:07:39.81901:07:39.829 already lowered or deplete displaced oil 01:07:42.33901:07:42.349 but they might even lower how much 01:07:44.74001:07:44.750 natural gas is used the same thing with 01:07:47.10901:07:47.119 transportation obviously with electric 01:07:48.67001:07:48.680 vehicles etc but it seems to me that 01:07:50.71001:07:50.720 petrochemicals doesn't have this 01:07:53.06901:07:53.079 alternatives clear-cut economics that's 01:07:57.40001:07:57.410 I wonder if you agree with that 01:07:59.28901:07:59.299 long-term I'm talking about 2030 to 2050 01:08:01.90001:08:01.910 and imposing on that I like your opinion 01:08:07.00001:08:07.010 about especially in Europe which seems 01:08:10.45001:08:10.460 to be going ahead with a carbon price if 01:08:13.90001:08:13.910 you assume a modest carbon price let's 01:08:17.91901:08:17.929 say $20 per ton of co2 or what I 01:08:21.66901:08:21.679 consider a more realistic carbon price 01:08:23.76901:08:23.779 which is $50 per co2 which is not 01:08:26.32001:08:26.330 unheard of in Scandinavia which has over 01:08:28.72001:08:28.730 almost $100 per ton today how do the 01:08:32.82901:08:32.839 economics look for the petrochemicals 01:08:34.78001:08:34.790 technologies the cts as well as the RTS 01:08:37.99001:08:38.000 and the biofuels and thirdly do you see 01:08:42.61001:08:42.620 that you made a projection about less 01:08:46.03001:08:46.040 availability of ethane because of 01:08:48.70001:08:48.710 natural gas 01:08:49.93901:08:49.949 but have you taken into account 01:08:51.76901:08:51.779 long-term the possibility that shale 01:08:56.10901:08:56.119 technology horizontal drilling and 01:09:00.03901:09:00.049 fracking is going to move outside the 01:09:03.58901:09:03.599 United States in other areas that have 01:09:05.93001:09:05.940 shale that are looking at it including 01:09:08.35901:09:08.369 China and others and therefore more 01:09:11.08901:09:11.099 natural gas might become available and 01:09:13.18901:09:13.199 therefore it's going to be in 01:09:14.53901:09:14.549 competition for both power gen as well 01:09:17.26901:09:17.279 as potentially for petrochemicals 01:09:19.03901:09:19.049 I wonder that those kind of long-term 01:09:21.24901:09:21.259 views I appreciate your opinion and 01:09:24.16901:09:24.179 definitely Jason's opinion well so a few 01:09:31.48901:09:31.499 reflections I have to remember these 01:09:33.37901:09:33.389 points so on the alternatives point 01:09:36.19901:09:36.209 first and so yes there are all 01:09:38.29901:09:38.309 sensitives and to using oil as a 01:09:40.48901:09:40.499 feedstock for petrochemicals and natural 01:09:43.03901:09:43.049 gas and coal theoretically any carbon 01:09:45.94901:09:45.959 hydrogen containing compound is as the 01:09:48.85901:09:48.869 candidate and that obvious ones are 01:09:51.52901:09:51.539 bioenergy and then electrically 01:09:53.98901:09:53.999 electrically electrolytic hydrogen so 01:09:57.29001:09:57.300 water electrolysis to produce hydrogen 01:09:59.75001:09:59.760 and then combining it with a carbon 01:10:01.52001:10:01.530 source usually co2 and to use it to make 01:10:06.16901:10:06.179 methanol and ammonia and those are those 01:10:08.27001:10:08.280 are two routes that we characterize in 01:10:11.02901:10:11.039 detail further primary chemicals in 01:10:12.79901:10:12.809 there in the chemical sector the the 01:10:15.35001:10:15.360 difficulty and the reason and I think 01:10:16.93901:10:16.949 this is moving more to the second 01:10:18.62001:10:18.630 question in the context of the broader 01:10:20.83901:10:20.849 energy system and the chemical sector 01:10:23.00001:10:23.010 playing its role within that the reason 01:10:25.87901:10:25.889 why these technologies don't see as much 01:10:29.33001:10:29.340 penetration given a level of carbon 01:10:32.27001:10:32.280 price or a broader context in which they 01:10:34.33901:10:34.349 they might be more you know more 01:10:36.52901:10:36.539 appealing to the to the modeling choices 01:10:38.44901:10:38.459 and more appealing among the modeling 01:10:41.60001:10:41.610 choices 01:10:42.10901:10:42.119 the reason before that is that CC u.s. 01:10:44.44901:10:44.459 is able to reduce the emissions keep the 01:10:47.12001:10:47.130 oil feedstock that is comparatively 01:10:49.16001:10:49.170 cheaper in a in a low lower carbon world 01:10:52.06901:10:52.079 when are there where other sectors are 01:10:54.56001:10:54.570 moving away from it its able to utilize 01:10:56.98901:10:56.999 this feedstock 01:10:57.73901:10:57.749 capture it at relatively low cost and 01:10:59.77001:10:59.780 and 01:11:01.37001:11:01.380 send it for transportation and storage 01:11:03.41001:11:03.420 so of the scalable long-term 01:11:06.53001:11:06.540 alternatives that's the one that 01:11:08.14901:11:08.159 according to our modeling at the moment 01:11:09.50001:11:09.510 wins out with a lower with a lower 01:11:11.93001:11:11.940 electricity price potentially with you 01:11:15.29001:11:15.300 know very low electricity prices from 01:11:18.35001:11:18.360 surplus electricity or maybe form 01:11:20.78001:11:20.790 stranded renewable assets so we're 01:11:22.85001:11:22.860 looking at that at the moment as well if 01:11:24.95001:11:24.960 you had super low electricity prices 01:11:26.81001:11:26.820 then these roots can become competitive 01:11:29.06001:11:29.070 and we actually produced a graph towards 01:11:32.75001:11:32.760 the end of the report where we do this 01:11:34.18901:11:34.199 off off CTS analysis where we look at 01:11:37.45001:11:37.460 for full electricity prices right down 01:11:40.66901:11:40.679 to their ten to twenty euros a megawatt 01:11:42.22901:11:42.239 hour which which of these technologies 01:11:45.56001:11:45.570 are competing what cost and for a given 01:11:48.26001:11:48.270 set of gas prices and feed stock prices 01:11:51.56001:11:51.570 for bioenergy so that I hope I've 01:11:54.43901:11:54.449 answered a couple of the they're first 01:11:56.12001:11:56.130 ones with with that on the ethane and 01:12:00.32001:12:00.330 LPG and well NGOs in general supply 01:12:03.64901:12:03.659 I think Jason probably would like to 01:12:06.11001:12:06.120 wear this for longer than me but and the 01:12:09.20001:12:09.210 NGO supply that we see in the US it 01:12:11.24001:12:11.250 comes from the the broader modeling that 01:12:13.12901:12:13.139 we do have different gas fields and oil 01:12:15.64901:12:15.659 fields around the world we have 01:12:16.82001:12:16.830 colleagues on the supply side who we 01:12:18.62001:12:18.630 look at all of those fields individually 01:12:20.54001:12:20.550 I believe they look at trade they look 01:12:22.79001:12:22.800 at likely yields and that kind of thing 01:12:24.80001:12:24.810 and and the the supply of ngl 01:12:29.24001:12:29.250 specifically the the dampening effect or 01:12:31.64001:12:31.650 the lower lowering of relative supply 01:12:34.64001:12:34.650 despite continuing natural gas 01:12:36.47001:12:36.480 production from these assets and fields 01:12:39.08001:12:39.090 is because as the shale gas operations 01:12:43.85001:12:43.860 move to fields the further along the 01:12:48.41001:12:48.420 supply curve they are yet drier so 01:12:52.04001:12:52.050 they're fewer NGOs in the in the gas 01:12:54.05001:12:54.060 stream that's that's my understanding of 01:12:55.45901:12:55.469 it and and that's where this flattening 01:12:58.31001:12:58.320 supply of Ethan and LPG comes in in the 01:13:01.45901:13:01.469 in the modeling and I assume I assume 01:13:02.81001:13:02.820 that a fairly 01:13:03.97901:13:03.989 is modeled within the other regions as 01:13:07.22001:13:07.230 well that where --shelves --shelves 01:13:09.16901:13:09.179 looked at but I might refer you to their 01:13:12.89001:13:12.900 supply colleagues and on the World 01:13:14.95901:13:14.969 Energy Outlook site for a detailed 01:13:16.58001:13:16.590 discussion of that topic there were a 01:13:19.04001:13:19.050 lot of pieces to the question so I don't 01:13:21.43901:13:21.449 may have lost the thread but I and just 01:13:25.06901:13:25.079 make a point you asked about co2 pricing 01:13:27.10901:13:27.119 and the impact that it would have and so 01:13:29.12001:13:29.130 I think there's a question which is what 01:13:30.64901:13:30.659 impact a given co2 price would have on 01:13:32.81001:13:32.820 the competitiveness of it and you may 01:13:34.43001:13:34.440 have thoughts about that in your 01:13:36.37901:13:36.389 modeling one point I would make I think 01:13:38.93001:13:38.940 is important to keep in mind is the kind 01:13:41.50901:13:41.519 of political economy of carbon pricing 01:13:43.93901:13:43.949 and how we actually see carbon prices 01:13:46.37001:13:46.380 get implemented and designed both to 01:13:48.10901:13:48.119 build political support and because 01:13:50.20901:13:50.219 almost any carbon price regime is likely 01:13:53.66001:13:53.670 to have border adjustments built into it 01:13:55.66901:13:55.679 to protect the competitiveness of the 01:13:57.14001:13:57.150 manufacturing sector petrochemicals 01:13:58.85001:13:58.860 would be one that would be seen as very 01:14:00.70901:14:00.719 vulnerable to being undermined by a 01:14:02.98901:14:02.999 carbon price if your competitors 01:14:04.33901:14:04.349 overseas we're not paying a similar 01:14:05.77901:14:05.789 carbon price so I I think it's in in 01:14:08.75001:14:08.760 terms of your policy recommendations I 01:14:10.72901:14:10.739 see the petrochemical sector as tell me 01:14:13.85001:14:13.860 if you agree being one of the more 01:14:16.45901:14:16.469 difficult ones to actually impose a 01:14:18.25901:14:18.269 carbon price on because it's always 01:14:19.75901:14:19.769 gonna get a cup caught up in this trade 01:14:22.10001:14:22.110 and competitiveness argument that's 01:14:23.35901:14:23.369 likely to mean even countries that move 01:14:25.22001:14:25.230 forward or States or whatever with a 01:14:26.72001:14:26.730 carbon price may end up actually 01:14:29.23901:14:29.249 exempting large segments of of the 01:14:33.14001:14:33.150 manufacturing sector that could include 01:14:34.60901:14:34.619 petrochemicals we've seen that where 01:14:36.56001:14:36.570 petricka where carbon pricing has been 01:14:38.08901:14:38.099 implemented so far I think you asked 01:14:40.54901:14:40.559 about shale outside the US as well and I 01:14:43.60901:14:43.619 think that I mean we know the resource 01:14:46.54901:14:46.559 is there there's not in shale is not 01:14:48.58901:14:48.599 unique to the US by any means there of 01:14:50.20901:14:50.219 course more challenges with 01:14:51.22901:14:51.239 infrastructure and water availability 01:14:52.64001:14:52.650 and private land ownership and other 01:14:54.10901:14:54.119 things but given the right incentives I 01:14:57.37901:14:57.389 think we're already seeing it developed 01:14:58.93901:14:58.949 in black America in in Argentina and it 01:15:01.97001:15:01.980 will get developed elsewhere there's 01:15:04.45901:15:04.469 also some benefit to it because it's 01:15:06.04901:15:06.059 more short cycle in nature and as their 01:15:07.91001:15:07.920 attendant be continued to be growing 01:15:09.31901:15:09.329 concerns about a long term oil demand 01:15:10.81901:15:10.829 growth there's a some desirability we 01:15:13.72901:15:13.739 see in the part of the industry which is 01:15:15.16901:15:15.179 increasingly shifting capital towards 01:15:17.23901:15:17.249 things that are 01:15:17.87001:15:17.880 cycle shell might become more attractive 01:15:19.31001:15:19.320 for that reason I would just add on the 01:15:23.24001:15:23.250 on the industry kind of carbon leakage 01:15:25.24001:15:25.250 point that for sure that's something 01:15:28.22001:15:28.230 that we we hear from industry 01:15:30.20001:15:30.210 stakeholders but not just in the 01:15:31.79001:15:31.800 petrochemical industry but in the engage 01:15:34.58001:15:34.590 on five energy intensive sub sectors in 01:15:37.87901:15:37.889 specifically in the technology division 01:15:40.43001:15:40.440 pulp and paper cement iron and steel 01:15:42.64901:15:42.659 aluminium and and chemicals and this is 01:15:45.64901:15:45.659 a relatively common theme that people 01:15:49.12901:15:49.139 with industries with relatively older 01:15:53.22901:15:53.239 assets in places like Europe with the 01:15:55.97001:15:55.980 most likely integration of of some of 01:15:59.27001:15:59.280 these policies and say that well you 01:16:02.78001:16:02.790 know if we have to rebuild these plants 01:16:04.28001:16:04.290 there it won't be here and that kind of 01:16:06.80001:16:06.810 message coming through and against that 01:16:09.47001:16:09.480 policy push but it's it's obviously hard 01:16:13.97001:16:13.980 to predict what were the adjustments and 01:16:16.10001:16:16.110 kind of policy compensations would be 01:16:18.20001:16:18.210 put in place for for those kind of 01:16:20.91901:16:20.929 adjustments 01:16:22.77001:16:22.780 I think mark may have had a question 01:16:24.41901:16:24.429 someone more knowledgeable than us mark 01:16:28.47001:16:28.480 Schwartz Platts analytics a very very 01:16:30.51001:16:30.520 interesting talk and very important 01:16:31.91901:16:31.929 topic we come to almost exactly the same 01:16:34.50001:16:34.510 conclusions about the importance of 01:16:36.68001:16:36.690 petrochemicals I think you mentioned the 01:16:39.35901:16:39.369 term cost-effective recycling so I'm 01:16:42.89901:16:42.909 wondering in a study you know have did 01:16:45.20901:16:45.219 you take a look at the economics of 01:16:46.85901:16:46.869 recycling versus primary plastics 01:16:49.77001:16:49.780 production where do we see 01:16:51.62901:16:51.639 cost-effective recycling today what's it 01:16:54.33001:16:54.340 going to take to get there is the market 01:16:57.12001:16:57.130 going to get there do they need a little 01:16:58.31901:16:58.329 help from carbon fees and other other 01:17:00.41901:17:00.429 fees on one-time use what can you say 01:17:03.00001:17:03.010 about the economics so the investment 01:17:06.51001:17:06.520 numbers it's important to clarify refer 01:17:08.87901:17:08.889 only to primary chemical production so 01:17:10.79901:17:10.809 when when we are talking about recycling 01:17:13.52901:17:13.539 there were the secondary process 01:17:15.77901:17:15.789 equipment that's not included within 01:17:17.33901:17:17.349 those within those figures which does 01:17:19.31901:17:19.329 lead to a bit of a distorting effect in 01:17:23.52001:17:23.530 terms of the investment and but they're 01:17:25.91901:17:25.929 very expensive assets upstream and 01:17:28.22901:17:28.239 producing primary chemicals are an 01:17:29.85001:17:29.860 important consideration in terms of 01:17:33.35901:17:33.369 their economics of one versus the other 01:17:35.58001:17:35.590 I think this this very much depends on 01:17:37.47001:17:37.480 the type of recycling on the plastics 01:17:39.45001:17:39.460 front I've assumed your friend too and 01:17:41.58001:17:41.590 and so we've I mean maybe you've got 01:17:45.06001:17:45.070 three main types as we characterize it 01:17:47.33901:17:47.349 in the report and more generally 01:17:49.02001:17:49.030 mechanical chemical and then back to 01:17:51.29901:17:51.309 feedstock and and as as far as I am 01:17:55.95001:17:55.960 aware the the chemical and back to 01:17:58.31901:17:58.329 feedstock level recycling is at 01:18:00.89901:18:00.909 demonstration phase and relatively early 01:18:04.12901:18:04.139 on in the development stage of really it 01:18:07.79901:18:07.809 not not many processes brought to market 01:18:10.16901:18:10.179 as far as we're aware mechanical 01:18:12.66001:18:12.670 recycling well-established can be cost 01:18:15.68901:18:15.699 effective if there's the right 01:18:17.04001:18:17.050 incentives and if a lot of the 01:18:18.77901:18:18.789 collection and sorting processes are are 01:18:22.83001:18:22.840 handled or taken care of by the 01:18:24.24001:18:24.250 municipality or by a third party I think 01:18:27.77901:18:27.789 I mean for p84 recycled polyethylene 01:18:31.22901:18:31.239 terephthalate these 01:18:34.49001:18:34.500 the chips have a have a market price and 01:18:36.95001:18:36.960 when oil prices are high some producers 01:18:40.16001:18:40.170 I think switch to larger chunks of 01:18:42.77001:18:42.780 secondary production so in specific 01:18:44.60001:18:44.610 market segments as far as I'm aware 01:18:46.70001:18:46.710 there are there are aspects of already 01:18:49.72901:18:49.739 kind of cost competitive elements to to 01:18:52.55001:18:52.560 recycled and secondary plastic 01:18:54.38001:18:54.390 production but nothing like the scale 01:18:57.11001:18:57.120 that we we need this is it's as far as 01:18:59.99001:19:00.000 I'm aware the the most recycled plastic 01:19:02.27001:19:02.280 resin is is PE T and it's because it has 01:19:04.22001:19:04.230 a high value application that can be 01:19:06.56001:19:06.570 recirculated and it has this big 01:19:08.57001:19:08.580 downcycling 01:19:09.97001:19:09.980 opportunity to fiber which is a huge 01:19:13.22001:19:13.230 huge market that then has no recycling 01:19:15.08001:19:15.090 associated with it so I think in 01:19:16.61001:19:16.620 specific segments we use in specific 01:19:19.18901:19:19.199 aspect elements of the cycle you can see 01:19:21.92001:19:21.930 some cost competitiveness but I think in 01:19:24.05001:19:24.060 the in the full gamut of recycling 01:19:27.50001:19:27.510 options you see relatively limited cost 01:19:30.14001:19:30.150 effectiveness that's my you know just a 01:19:38.81001:19:38.820 question on that top-down analysis looks 01:19:41.00001:19:41.010 just introduced oh yeah sure forgot that 01:19:42.65001:19:42.660 mark as you said I just jumped down so 01:19:44.51001:19:44.520 Terry Vishwanath I'm with SNP analytics 01:19:47.00001:19:47.010 so just a quick question on the on the 01:19:49.58001:19:49.590 top-down analysis you know I think that 01:19:51.65001:19:51.660 chart was really great you talked about 01:19:52.93901:19:52.949 the difference between industrialized 01:19:54.41001:19:54.420 versus emerging nations the 22 you know 01:19:57.53001:19:57.540 20 to 1 and then the 10 to 1 and 01:19:59.47901:19:59.489 fertilizers we've seen some changes 01:20:02.24001:20:02.250 occur within these components so for 01:20:04.10001:20:04.110 example over the last 4 years you know 01:20:07.28001:20:07.290 China has actually decreased their 01:20:09.43001:20:09.440 percent of fertilizer application per 01:20:11.78001:20:11.790 crop 15 percent each year 2014 to 2018 01:20:14.68901:20:14.699 you're seeing a shift occur within these 01:20:16.76001:20:16.770 segments can we assume all size fits one 01:20:19.18901:20:19.199 when we think about doing that analysis 01:20:21.14001:20:21.150 because we you know we all kind of 01:20:22.18901:20:22.199 juggle with it but what do you think no 01:20:25.22001:20:25.230 absolutely I think this especially on 01:20:27.05001:20:27.060 the fertilizer front the nitrogenous 01:20:29.00001:20:29.010 fertilizers is significant gain still to 01:20:32.18001:20:32.190 be made on the on the efficiency in the 01:20:34.61001:20:34.620 application efficiency front has been 01:20:36.50001:20:36.510 lots of academic papers written about 01:20:38.63001:20:38.640 this in the past but I think this is 01:20:39.89001:20:39.900 really gaining traction in the more in 01:20:41.93001:20:41.940 the policy sphere and 01:20:43.39901:20:43.409 the technology sphere and so perhaps 01:20:47.44901:20:47.459 these multipliers won't come to their 01:20:49.31001:20:49.320 full fruition of multiplying every per 01:20:53.27001:20:53.280 capita demand in African countries and 01:20:55.87901:20:55.889 other and Indians and so on by by five 01:20:59.92901:20:59.939 or twenty or ten but I mean if some 01:21:02.47901:21:02.489 small degree of that occurs there's this 01:21:05.12001:21:05.130 that still spells a relatively strong 01:21:08.14901:21:08.159 growth trajectory for countries in which 01:21:11.08901:21:11.099 the per capita figures for was plastics 01:21:14.47901:21:14.489 especially as where it's more acute are 01:21:16.33901:21:16.349 really in the kind of single-digit 01:21:18.40901:21:18.419 kilogram figures according to the the 01:21:20.33001:21:20.340 data we have I mean we would definitely 01:21:24.02001:21:24.030 like to have a look at some of the 01:21:26.41901:21:26.429 figures you're talking about for and for 01:21:28.90901:21:28.919 those some of the more detailed case 01:21:30.52901:21:30.539 studies because I mean again we find on 01:21:34.39901:21:34.409 in the in the public sector in the 01:21:36.56001:21:36.570 public realm data on on detailed stuff 01:21:39.67901:21:39.689 like this about yields of crops from 01:21:42.83001:21:42.840 particular fertilizers we have a good 01:21:44.68901:21:44.699 relationship with the international 01:21:46.06901:21:46.079 fertilizer Association who who were 01:21:49.00901:21:49.019 kindly supported us analytically through 01:21:52.75901:21:52.769 various aspects of data gathering and so 01:21:55.04001:21:55.050 on and but I mean the the public realm 01:21:58.52001:21:58.530 data for for this topic is is very hard 01:22:01.69901:22:01.709 for us to get the high-resolution data 01:22:03.85901:22:03.869 to do some of the things that Katherine 01:22:06.22901:22:06.239 mentioned that we would be great to look 01:22:08.54001:22:08.550 at 01:22:09.16901:22:09.179 you know price sensitivity and 01:22:10.79001:22:10.800 ethnicities and and so on but I think 01:22:13.75901:22:13.769 that chart for sure is at a high level 01:22:16.15901:22:16.169 it's meant to draw home their kind of 01:22:19.35901:22:19.369 wider potential if even some of that 01:22:22.95901:22:22.969 equalizing in per capita demand came to 01:22:25.37001:22:25.380 came to fruition thanks Peter 01:22:29.08901:22:29.099 I am conscious at the time so I I think 01:22:31.72901:22:31.739 maybe we'll just end with one final 01:22:33.56001:22:33.570 question you know if you were to do a 01:22:36.14001:22:36.150 part of this report are there any topics 01:22:41.14901:22:41.159 that you think merit further research 01:22:42.90901:22:42.919 understanding of course the myriad data 01:22:45.16901:22:45.179 limitations that we're dealing with what 01:22:48.79901:22:48.809 didn't make the cut here that you think 01:22:50.27001:22:50.280 is still interesting to look at 01:22:52.59001:22:52.600 well I would definitely like to do more 01:22:56.74001:22:56.750 in this topic personally I said it's a 01:22:58.39001:22:58.400 great interest of mine and I think it 01:23:00.49001:23:00.500 for several analysts at the agency so 01:23:03.01001:23:03.020 we're we're definitely primed if there's 01:23:04.66001:23:04.670 appetite for it and the reception for 01:23:07.81001:23:07.820 this publication will certainly be a big 01:23:11.34001:23:11.350 factor in whether that comes about and 01:23:14.31001:23:14.320 but I think some of the aspects that 01:23:17.68001:23:17.690 we've touched on in the discussion are 01:23:19.90001:23:19.910 really where I think the most 01:23:21.70001:23:21.710 interesting aspects for further more 01:23:24.70001:23:24.710 detailed analysis lie data pending and 01:23:27.88001:23:27.890 all of those caveats and but we we I 01:23:32.17001:23:32.180 think we made some good steps forward at 01:23:33.97001:23:33.980 least in the public domain for data the 01:23:36.85001:23:36.860 link between induced consumer products 01:23:40.06001:23:40.070 and and the plastic and petrochemical 01:23:42.64001:23:42.650 products that we use and the impact on 01:23:45.46001:23:45.470 or demand I think we we drew some some 01:23:47.77001:23:47.780 nice links there both physically and in 01:23:50.26001:23:50.270 the dynamics front on the feedstock 01:23:52.39001:23:52.400 front and but we could we could go a lot 01:23:56.17001:23:56.180 more high-resolution on that front I 01:23:57.58001:23:57.590 think a lot of a lot of the kind of more 01:24:00.40001:24:00.410 detailed case studies outside plastics 01:24:02.56001:24:02.570 as well fibre rubber fertilizers in more 01:24:06.13001:24:06.140 detail would be great to look at on 01:24:08.47001:24:08.480 their on the more consumption end and do 01:24:10.72001:24:10.730 a kind of full 01:24:12.31001:24:12.320 you know bottom-up analysis of those 01:24:15.51001:24:15.520 consumption drivers in even more detail 01:24:17.38001:24:17.390 would be would be great to do and yeah 01:24:21.04001:24:21.050 and I think I mean I'm not sure whether 01:24:23.26001:24:23.270 this would be in the remit of the DIA 01:24:25.66001:24:25.670 but then I think some it's one of the 01:24:29.47001:24:29.480 one of the key drivers that I envisage 01:24:31.99001:24:32.000 being for the on the environmental side 01:24:34.48001:24:34.490 is the the plastic waste leakage issue I 01:24:38.47001:24:38.480 think is really garnering attention and 01:24:41.35001:24:41.360 you know capturing hearts and minds and 01:24:42.94001:24:42.950 and I think the the extent to which that 01:24:45.94001:24:45.950 can kind of action behavioral change on 01:24:48.25001:24:48.260 the littering front and waste management 01:24:49.99001:24:50.000 front I think it's an area that would be 01:24:52.78001:24:52.790 great to study and see how we can 01:24:54.55001:24:54.560 galvanize the support this obviously 01:24:57.64001:24:57.650 there 01:24:58.59001:24:58.600 in lots of communities and so the kind 01:25:01.53001:25:01.540 of behavioral links on that front would 01:25:03.18001:25:03.190 be would be really interesting to to 01:25:05.07001:25:05.080 analyze I think great well thank you so 01:25:08.13001:25:08.140 much for joining us Peter is straight 01:25:10.50001:25:10.510 off a plane from Paris so now I hope 01:25:13.53001:25:13.540 they'll have a well-deserved dinner and 01:25:15.78001:25:15.790 a night of rest and thank you all for 01:25:17.97001:25:17.980 joining us as well I just want to remind 01:25:19.74001:25:19.750 you that the full video recording of 01:25:21.36001:25:21.370 this event will be available on the 01:25:22.53001:25:22.540 website and on our website in a few days 01:25:24.62001:25:24.630 and our podcast is something you can 01:25:27.42001:25:27.430 also subscribe to on iTunes and a number 01:25:31.17001:25:31.180 of other platforms I haven't even heard 01:25:32.76001:25:32.770 of like stitcher and SoundCloud that 01:25:35.49001:25:35.500 make me feel bit old I also just want to 01:25:37.89001:25:37.900 highlight a couple of great events that 01:25:39.90001:25:39.910 we have coming up one is on October 19th 01:25:42.96001:25:42.970 in the morning here on campus the impact 01:25:45.72001:25:45.730 of us LNG on Russian natural gas export 01:25:48.51001:25:48.520 policy were pleased to be joined by one 01:25:51.39001:25:51.400 of our cg up fellows dr. Tatiana Metro 01:25:53.88001:25:53.890 vu who's also the director of the school 01:25:56.43001:25:56.440 Cova Energy Center in Moscow as well as 01:25:58.86001:25:58.870 a number of other panelists who will be 01:26:00.69001:26:00.700 joining her on that topic and then on 01:26:02.88001:26:02.890 October 26 the a will be back talking 01:26:07.59001:26:07.600 about renewable their renewable energy 01:26:10.44001:26:10.450 market report for 2018 and the speaker 01:26:12.63001:26:12.640 will be Jaime Behar who is a renewable 01:26:15.12001:26:15.130 experts a renewable expert at the IEA so 01:26:18.63001:26:18.640 please keep those dates in mind and we 01:26:20.31001:26:20.320 look forward to seeing you again soon 01:26:21.42001:26:21.430 thank you all so much for coming 01:26:23.49001:26:23.500 [Applause]
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