Canada’s chemical industry: All the right ingredients for economic recovery

You might be surprised to know more than 70,000 everyday products result from chemistry. The mattress you sleep on… the clothes you wear… the food you eat… the natural gas that heats your home and the pipelines that transport it.

Bob Masterson, President and CEO, Chemistry Industry Association of Canada

Bob Masterson, President and CEO, Chemistry Industry Association of Canada

This week, Bob Masterson, President and CEO of the Chemistry Industry Association of Canada (CIAC) took time to talk with About Pipelines about the role the chemical industry can have in Canada’s economic recovery.

 

In a recent publication you talked about the resilience of the chemical industry during the pandemic. What do you believe are the main reasons for that resilience?

 

There are three primary reasons. First… despite the pandemic, there’s continued demand for products, which means there’s demand for chemicals.

Few people are aware that 95 per cent of finished products involves chemical processes.

Second, we started worrying about food safety and cleanliness as the pandemic unfolded. With that came increased demand for plastics and cleaning supplies as part of COVID response measures… for food packaging, PPE, isopropyl alcohol, and hospital equipment. And more Canadians now know we need to retain the benefits of plastics and manage plastic waste pollution. As an industry, we know we can meet those expectations.

And third… the chemical industry has Responsible Care®, which helps us prepare for worst-case scenarios. That’s why CIAC member companies had pandemic plans that they could put into action quickly. So, although there were challenges, we were prepared.

 

How does this resilience position the chemical industry to participate in economic recovery?

 

Global demand for chemical products and plastics is high… so is the demand for cleaner energy and air. Canada’s chemical industry is creating some of the lowest GHG-intensive chemical products on the planet. We have all the right ingredients… experience… low carbon resources… and we can serve world markets at a fraction of the GHG footprint of some other countries. But what we need is all levels of government aligned. There are no reasons provincial and federal governments couldn’t collaborate on economic recovery in the same way they’re doing with the COVID response.

 

What’s the most significant economic benefit for Canada in developing the chemical industry?

 

Let’s first look at the potential benefits for average Canadians. They could benefit from stable, high paying jobs for the long-term. Once these jobs are here, they stay, and can have high average annual salaries.

Central Canada no longer relies on domestic supplies of natural gas – it’s imported from the U.S. That means our largest natural gas consumer (the U.S.) is also our largest competitor. There’s great opportunity for the chemical industry to process the excess Canadian natural gas, and Canadians would get the economic benefit.

The pandemic showed us that we lack manufacturing capacity. We became too dependent on our trade partners for manufacturing. Canada’s chemical industry can meet those manufacturing needs.

And, from a global climate change perspective, there are advantages to producing gas-based chemicals in Canada. The demand for methanol derived from coal is high in Asia, especially China. We can make methanol out of natural gas at eight times less GHG-intensity than coal.

Regardless of the challenges posed by COVID-19, the chemical industry is resilient. Investment is there for the long-term – 40 to 50 years – if we can attract it. We’re also investment ready. So, there’s opportunity to get our fair share of global petrochemical value.

 

What big challenges keep you awake at night?

 

Although the outlook is positive in western Canada, I’m deeply concerned that we haven’t seen new investment in central Canada for some time. Central Canada is core to our country’s manufacturing. And if we can’t attract investment in those areas, the industry runs the risk of disappearing there. I believe the key ingredient is top-to-bottom alignment across all levels of governments.

Canadian Energy Pipeline Association (CEPA) members are proud to partner with the chemical industry by transporting oil and gas products to petrochemical processing plants across the county. About Pipelines blog thanks Bob Masterson for his participation in this blog post.