Issue 8, 2016 - Global Chemicals Quick Facts

Global Chemicals Quick Review

Low oil prices do not change the growth trend of Canadian oil sands production

Despite the sharp drop in oil prices, Canada's projects already under construction will sustain the country's oil sands production growth for about five years, although oil sands producers are trying to cut costs
by cutting jobs or delaying new investments.
While it is unlikely that new oil sands projects will be announced before oil prices recover, increased production from existing projects has already compensated for the delay in some new projects
.
Canada's oil sands production is expected to increase from 2.
5 million b/d today to 3.
3 million b/d
by 2020, according to the Energy Commission of Canada (NEB).
The total investment in major new or expanded Canadian oil sands projects is expected to be $15 billion in 2015, more than 30 per cent
less than in 2014.
The NEB said more than 700,000 bpd
of oil sands projects have been cancelled or postponed in Canada due to low oil prices.

Global petrochemical capacity continues to grow in an uncertain environment

In the past few years, there have been a large number of new petrochemical projects
announced worldwide.
Global petrochemical capacity will see strong growth
by 2020, as emerging economies in regions such as the Middle East and Asia to the United States have announced petrochemical capacity expansion.
However, the decline in oil prices has also increased the uncertainty faced by the global petrochemical industry and has significantly changed the dynamics of the
petrochemical industry.
Since June 2014, more than $130 billion of projects in the downstream oil and gas processing industry have been cancelled or delayed, including large investment projects
in Asia Pacific, Eastern Europe and the Middle East.
About 27 percent ($35 billion) of those cancelled or delayed projects are in the petrochemical industry
.

Rechargeable batteries will lead the rapid growth of global lithium demand

IHS Chemical estimates that global lithium demand will grow rapidly at an average annual rate of 4.
4% during 2015~2020, and the main driving force for lithium demand growth comes from rechargeable batteries
.
In 2015, the global lithium consumption reached 33,400 tons, of which the battery industry consumed 11,000 tons of lithium, accounting for 34% of the total consumption, and will grow at an average annual rate of 8.
3% in 2015~2020; The ceramic and glass industry consumes 9,700 tons of lithium, accounting for 29% of total consumption, and will grow
at an average annual rate of 2.
2% over the same period.
Samantha Wietlisbach, chief analyst at IHS Chemistry, said that the use of lithium batteries for electric vehicles will lead the growth of
lithium demand in the future.
These include battery electric vehicles (EVs), hybrid electric vehicles (HEVs), and plug-in hybrid electric vehicles (PHEVs).

Major global automakers are actively developing lithium batteries for electric vehicles, and the biggest growth in lithium consumption will occur in EVs and PHEVs
.