Image credit: Wikimedia Commons
by Steven Kelly
November 2021
Table of Contents
- Executive Summary
- Introduction
- Petrochemical Industry Outlook
- Opportunities and Challenges in the Global Petrochemicals Industry
- Conclusion
- End Notes
- About the Author
- Canadian Global Affairs Institute
Executive Summary
This paper provides an overview of the modern petrochemical industry and describes the historical context for Canada’s diverse regional operations. Key factors that influence investment and profitability of players in the global petrochemical industry include availability of low-cost feedstock, logistical optimization considering changing patterns of regional demand and a drive for ever greater economies of scale. These factors are assessed in the context of an ongoing shift in market fundamentals towards Asia. Significant industry trends include technological developments and an emerging consensus for greater sustainability. The implications of these trends for policy-makers and participants in the Canadian industry are briefly explored.
Introduction
The global petrochemical industry is technologically sophisticated and highly diversified.1 Some firms, including national oil companies (NOC) and international oil companies, are highly integrated from feedstock supply through to end products; other players are diversified chemical companies and more specialized petrochemical producers.
For the purpose of this review, it is appropriate to consider olefins, aromatics and ammonia/methanol as base petrochemicals. Derived from crude oil and/or natural gas, these are the foundational building blocks for a myriad of derivatives, including many of the important polymers.2
It would be difficult to overstate how integral petrochemicals are to modern society. Their presence is widespread and growing, in line with burgeoning end-use demand for derivatives. Petrochemicals are essential for the production of thousands of industrial and consumer products, such as plastics, paints and solvents, synthetic rubber, fertilizers, detergents, textiles, dyes and pharmaceuticals.
Petrochemical production, mainly for plastics, is the leading source of non-combusted demand for oil and gas. There is a strong correlation between petrochemical demand and economic development. So, while it is possible to project a plateau and eventually a decline in petroleum demand for traditional fuels markets, growth in demand for petrochemical feedstocks is expected to continue for the foreseeable future. It should not be a surprise that the International Energy Agency (IEA) projects developing countries to see the highest growth rate in petrochemicals demand.3
The prevalence of petrochemicals in all facets of modern life is a testament to the ingenuity that has made this possible in less than a century, and a reminder that a tipping point may be looming. Constraints on unbridled growth were already emerging before the 2020 coronavirus pandemic. In the pandemic’s wake, the industry may enter a period of significant transition, as greater attention is focused on societal issues.
In Canada, the chemical industry is an important sector of the overall economy, accounting for $52 billion of shipments and $36 billion of exports in 2020.4 Petrochemicals are a key subsector of the broader chemical industry and are regionally segregated among processing centres in Alberta, Ontario and Quebec.5 Following the discovery of oil in Leduc, AB in 1947, a thriving regional petrochemical industry based on ethane developed in the province. Later developments sought diversification into other feedstocks derived from bitumen and heavy oil upgrading. Most domestic fertilizer production occurs in Western Canada as production of the key feedstock, ammonia, is economically located near the region’s abundant natural gas supplies.
Sarnia’s “Chemical Valley” is a complex of refineries and petrochemical plants rooted in the earliest oil discoveries in Canada. Wartime demand for synthetic rubber bolstered development in the 1940s. The industry subsequently flourished in the 1970s on the differential between high oil prices in global markets and low domestic prices for feedstocks, but by the 1980s a major recession led to a decline in regional petrochemical activity.6
The petrochemical industry in Montreal initially grew to support the industrial infrastructure of Quebec and Ontario. It was an industry traditionally based on feedstocks derived from the regional refining complex. However, in recent decades a contraction of activity parallel to that of the city’s refining sector has occurred.7
Petrochemical Industry Outlook
The petrochemical industry has seen nearly a generation of strong growth, both in aggregate market size and profitability. Competition for petrochemical industry investment is intense and global in its scope. Ethylene cracking margins, an indicator of industry profitability, were strong as recently as 2017, but fundamentals have since weakened with production capacity additions.8
By the start of this decade, the industry already faced uncertain near-term prospects, due to concerns about the sustainability of growth projections in emerging countries and overbuilding of capacity. Unprecedented demand declines due to the coronavirus pandemic drastically affected the industry in 2020. Evolving fundamentals in the pandemic’s wake appear certain to add further challenges for years to come.
Prospects for petrochemical industry profitability can typically be assessed in relation to several fundamental factors, which are discussed in this section. Developments in the Canadian industry are reviewed in context.
Petrochemical Demand Trends
According to IHS Markit, demand for six basic chemical products (ethylene, propylene, methanol, benzene, paraxylene and chlorine), stood at 515 million tonnes (MMT) in 2018, having grown by nearly 20 MMT each year for the preceding decade.9 Much of this demand growth is the production of commodity plastics, accounting for about half of the consumption of this key group of chemicals.
The per capita consumption of petrochemicals in advanced economies is many times larger than in developing economies. While total and per capita demand for plastics and fertilizer in the United States and Europe is significantly higher than in the major Asian economies, the IEA projects relative growth trends for the next several decades to favour Asia by a wide margin.10 In the same report, the IEA notes that demand for plastic has grown faster than for any other bulk material, such as steel or cement, nearly doubling since the turn of the millennium.
Per capita demand for some petrochemicals, such as fertilizers, may be expected to stabilize as economies mature. It is less clear that plastics use has reached a saturation level, even in the most advanced economies. However, a greater focus on the issue of plastics waste should be expected in the coming years, including bans on single-use plastics and co-ordinated action to reduce plastics leakage into the environment.11,12 Such initiatives could act to curtail prevailing demand trends.
One thing is beyond doubt: demand for all major petrochemicals is increasing globally, led by Asia and the Middle East. Before the extraordinary scenario that has unfolded due to the coronavirus pandemic, some analysts had projected a period of more moderate global petrochemical demand growth. Global ethylene demand growth did drop sharply in 2020, but IHS Markit projects annual growth to resume at a rate greater than underlying GDP growth by 2022.13
Demand growth in China leads the Asian region and the world, and this trend is expected to continue. Economic growth trends in Asia in the wake of the pandemic and how these relate to broader global trends will be a key determinant of petrochemical demand, and ultimately, industry profitability.
Production/Feedstock Selection
According to McKinsey, annual ethylene production – a rough proxy for the whole industry – increased from 100 MMT in 2000 to around 150 MMT in 2018, a compound annual growth rate of 2.3 per cent.14 It is not only ethylene which has seen robust production increases. Asian demand trends have driven capacity expansion in all the major petrochemical value chains. Capacity additions have consistently targeted growing demand in Asia.
Petrochemicals are a significant disposition route for oil and gas, accounting for about 14 and eight per cent of global oil and gas demand respectively in 2017.15 These proportions are likely to increase over the next decade, particularly the call on oil-based feedstocks, due to the cumulative impact of efficiency improvements on traditional transportation fuel demand and greater (albeit inconsistent) efforts to curtail demand in pursuit of greenhouse gas (GHG) reduction initiatives.
Of the factors impacting olefin industry economics, the most important are feedstock selection and plant location. It is generally advantageous to locate petrochemical manufacturing plants close to sources of low-cost feedstock, and for much of the last decade this has dictated new capacity additions.16
In North America, traditional olefin feedstocks have been the light byproducts of oil and gas production, largely due to greater availability of natural gas liquids (NGL) and a prevailing call on refinery naphtha in the production of transportation fuels. The rapid growth of U.S. shale oil production in the last decade has also generated an expanding surplus of NGL, and in turn, an increased interest in petrochemical production using these streams as feedstock.
The growing surplus of NGL products has created the incentive to invest in domestic ethylene capacity, resulting in something of a renaissance for the U.S.’s base petrochemicals industry. It is noted that lower crude prices since 2015 have increased the competitiveness of naphtha as a feedstock, narrowing the competitive advantage of gas-based projects.
Over the same time period, the Middle Eastern petrochemical industry has seen significant development based on surplus natural gas feedstocks. These initiatives have tended to be comprehensive on the scale of full industrial cities, such as the Jubail complex in Saudi Arabia. Furthermore, these developments signify shifting strategic objectives, most notably diversification away from historical dependence on oil production.
Interregional Trade
Beyond feedstock availability, factors that influence investment decisions in the petrochemical industry include regional capital costs, availability of regional incentives and downstream business needs. While it may be desirable to locate production capacity close to end-use markets, the more critical factor influencing competitiveness between regional industries is the all‑in cost of production and delivery of derivative products to a specific target market. As a practical matter, then, interregional trade of petrochemicals remains an important factor affecting the global industry.
Another key consideration affecting new capacity decisions is the comparative economics of exporting base petrochemicals and derivatives. An emerging trend in North America is the construction of export terminal capacity for feedstocks and base petrochemicals.17 This follows the aforementioned growth trend for NGL surpluses in the U.S. and reflects the interest of domestic petrochemical producers in capturing additional margin through vertical integration.
Not surprisingly, the target market for exported feedstocks and base petrochemicals has been the Asia-Pacific region. In large part, Gulf Coast NGL exports are targeting new Chinese conversion capacity, while the export of polyolefins to Asia has supported offshore manufacturing operations. However, there are several emerging challenges. Trade friction between the U.S. and China threatens to constrain historical product flows. There is also growing competition for Chinese conversion capacity from other feedstock supply regions.
China has aggressively pursued a policy of self-sufficiency in petrochemicals manufacture. Capacity has been added in all petrochemical value chains, significantly reducing China’s trade deficit in chemicals over the last decade. Nevertheless, interregional trade appears likely to remain highly dynamic and always influenced by underlying fundamentals.
Canadian Petrochemical Industry Developments
Given that its production is surplus to domestic demand, Canada’s petrochemical industry is inextricably linked to global market fundamentals. The interplay of opportunities and challenges beyond Canada’s borders is therefore of interest to participants in the domestic industry. Undoubtedly, the most dominant influence affecting domestic players in recent years has been growing supplies of NGL feedstocks. As noted, this is a direct result of shale gas developments in North America and the fundamental shifts that these investments have had on commodity flows between regions.
In Western Canada, the liquids-rich Montney play is generating significant interest in petrochemical processing of advantaged feedstocks. However, progress on two commercial-scale propane dehydrogenation (PDH) plants under consideration in Alberta has slowed because of uncertainty due to the coronavirus pandemic.18 Should they eventually proceed, these Alberta-based plants would produce polypropylene (PP) resin, which could be shipped by rail to serve foreign derivative processing.
Prior to the pandemic, there was renewed interest in Western Canadian production of methanol. Methanol is an important base petrochemical produced from natural gas. It is a feedstock for many industrial and consumer products and a blending component for transportation fuels. Project proposals19 were prompted by ample feedstock supply, advantageous logistics for Asian delivery relative to U.S. Gulf Coast production and a broader suite of potential uses for methanol in derivative processing.
In Ontario, favourable access to liquids from the adjacent Marcellus and Utica shale plays in the U.S. has facilitated several major projects at the NOVA petrochemical complex in Sarnia. The NOVA facility has undergone a significant capacity expansion, as well as a shift away from naphtha-based feedstocks (which have historically been sourced in Western Canada) to potentially 100 per cent ethane feedstock.
Opportunities and Challenges in the Global Petrochemicals Industry
The massive shift in petrochemical market fundamentals towards Asia has already caused disruptive changes in the global industry. Sustained Asian demand growth across all petrochemical value chains, and the cumulative effect of capacity additions based on regionally advantaged feedstock, have prompted interest in alternative production technology to balance supply with demand. Several such developments are explored in this section. Whether such technologies can achieve (or sustain) commercial viability through appropriate economies of scale and capital efficiency is a question that may be answered over the next decade.
The Canadian industry will unquestionably be impacted by global developments, as a major supplier of feedstocks and petrochemical products. The disruptive influence of shale gas developments on the domestic industry over the last decade illustrates the challenges policy-makers face when considering how to facilitate development of a capital-intensive, export-oriented industry with long supply lines to end-use markets.
The Rise of On-purpose Propylene
A trend towards on-purpose propylene processing is a direct and practical response to the commissioning of more ethane-based olefins cracking capacity around the world. Because traditional steam cracking of ethane is highly selective to ethylene yield, the recent wave of ethane-based cracking has resulted in lower yields of propylene as a byproduct. At the same time, propylene continues to be one of the most rapidly growing base petrochemicals. These trends have prompted growing interest in PDH capacity as an alternative production route for propylene based on a catalytic process.
PDH capacity consumes surplus propane and more importantly, helps to meet the growing propylene supply gap. In Alberta, PDH projects seem to offer viable opportunities for diversification, being within the scope of operations for the provincial petrochemical industry and beyond the traditional ethane value chain. Until the announced projects proceed to completion, these benefits appear less certain.
What Future for Methanol-to-Olefins (MTO) Technology?
China, already the world’s largest player in the methanol business, continues to grow its industry as a source of feedstock for numerous petrochemical derivatives. A unique feature of the domestic Chinese market is the significant use of methanol as a feedstock in methanol-to-olefins (MTO) plants. The MTO process and the similar coal-to-olefins (CTO) process provide an alternative route to the manufacture of low-carbon light olefins.
MTO/CTO technology was originally developed for production of gasoline blending components. It has been used in China to monetize large and remote reserves of natural gas and coal. The commercial application of this technology is relatively recent. Wood Mackenzie notes that China started up its first CTO unit in 2010 and by 2017, MTO/CTO accounted for 17 per cent of the country’s olefin production capacity.20 While the widespread implementation of MTO in China seems to have put to rest any question of its technical viability, questions remain about its long-term economic prospects. This is particularly true as new supplies of olefins reach the market from other regions.
For Canadian methanol producers, Asia’s attractiveness as a market outlet must be weighed carefully. The sheer size of the market and favourable logistics from Pacific coast ports likely support interest in China. However, market dynamics are changing rapidly. Slowing growth, coupled with an overhang of MTO capacity, seems destined to add uncertainty over the next decade.
Crude Oil-to-Chemicals (COTC) Refineries Change the Game
Another example of on-purpose processing that seems likely to change historical relationships between refineries and petrochemical operations is the trend towards configurations that maximize petrochemical feedstock yields rather than transportation fuel yields. Some analysts have suggested that petrochemical capacity additions based on gas feedstocks such as ethane have run their course, favouring highly integrated refinery configurations that provide a broad range of petrochemical feedstocks. These so-called “crude oil-to-chemicals” (COTC) complexes take the traditional co‑location advantages of refining and petrochemical facilities to a new extreme.21
Such levels of scale and processing integration are only realistic for the largest NOCs or state-supported entities. The COTC concept is being given its first practical implementation in China. The expectation of capital cost synergies and other efficiencies underlying these projects must be balanced against the strategic risks associated with commissioning configurations that are large, unique, and in some cases, based on novel processing technologies.
For Canadian petrochemical producers, the implications of capacity additions from COTC facilities may seem a world away. It is unlikely that the COTC concept could ever gain traction in Canada. However, their massive operational scale suggests that traditional patterns of interregional trade, which have been based on incremental capacity additions by diverse players, are bound to be upset. Market cycles originating from over- and under-building of capacity could be aggravated by these new players, increasing competitive pressure on high-cost producers.
A Green Future for Synthesis Gas?
Synthesis gas or “syngas” is a fuel gas mixture of hydrogen and carbon monoxide. As a petrochemical building block with innumerable input and disposition routes, syngas has offered great promise since the first practical applications of the technology were developed a century ago. Indeed, the optionality afforded by syngas technology makes it a Swiss army knife of chemical processes.
Syngas production via steam-methane reforming (SMR) is the predominant process for commercial production of hydrogen, ammonia, methanol and their many derivatives.22 There are numerous other syngas derivatives, including liquid transportation fuels (via the Fischer-Tropsch catalytic process) and power generation. The MTO and CTO processes described above are practical examples of how the syngas value chain can be extended beyond its traditional boundaries.
Hydrogen is an extremely versatile energy source. The concept of net-carbon neutrality based on a hydrogen economy has been touted as a key feature of a post-hydrocarbon world. While this may provide the impetus for even broader application of syngas technology, there are practical challenges. Not least is the energy-intensive nature of standard manufacturing routes for syngas. In addition, current hydrogen manufacturing technologies produce large amounts of concentrated carbon dioxide (CO2), which run counter to GHG emission-reduction initiatives.
Technological advances in hydrogen manufacture either target lower emissions (based on the capture of produced CO2) or use alternative production routes (based on electrolysis of water). Wood Mackenzie has described a range of processing options for hydrogen, commonly denoted by colours, which could open potential avenues to decarbonization.23
At present, the economics of more environmentally favourable syngas routes are not cost-competitive with the SMR process. As progress is made in reducing the cost of renewable electricity, it is possible that so-called “green hydrogen” options may eventually gain a footing in the petrochemical landscape.
In the current Canadian context, proponents of petrochemical diversification in Alberta point to abundant natural gas reserves and existing hydrogen-production infrastructure as key advantages. Furthermore, the availability of suitable geological formations in the province could support a shift in hydrogen manufacturing from “grey” (whereby produced CO2 is released to the atmosphere) to “blue” (whereby CO2 is captured for subsequent use in processing or enhanced oil recovery, or underground storage). Such developments offer a potential pathway to net-zero carbon emissions.
Disruption of International Trade in Recycled Plastics
As noted, global petrochemical trade has focused primarily on the flow of feedstocks and other petrochemical derivatives to Asia, in support of manufactured goods for the global economy. A secondary feature of this trade relationship has involved the backhaul shipment of recycled plastic to China.
In 2018, China enacted its “National Sword” policy, which effectively banned the import of most plastics and other materials previously destined for the country’s recycling processors.24 As a result, local governments and recyclers across North America and Europe have been forced to seek alternative markets, if available. This has become more challenging as other Asian countries follow China’s lead in restricting imports of recycled material. The disruption of international trade in recycled material has led municipalities to reconsider their waste and recycling policies. Recycling programs have been curtailed, including some in Canada, and material that was formerly collected for recycling has been stockpiled or diverted to landfills.25
Canadians have grown accustomed to the convenience of single-stream recycling programs. However, these programs have been hampered by high levels of contamination.26 Awareness of the need to reduce plastic waste is growing in all regions of the world, and in this context China’s policy change may be seen as an early warning sign for the petrochemical industry’s long-term growth prospects.
For the near term, growth expectations for petrochemicals appear robust, given the wide disparity in demand between markets. However, as a practical response to emerging constraints on the flow of recycled material, governments at all levels may consider options to support domestic recycling capacity, including cleaning and sorting facilities and plants that can convert recyclables into new products.
Conclusion
Few things are more prevalent in modern society than materials derived from petrochemicals. The Canadian petrochemical industry, comprised of several distinct regional hubs, is exposed to factors that have traditionally influenced global industry investment and profitability: availability of low-cost feedstock, changing patterns of regional demand and a drive for ever greater economies of scale. Seismic shifts in these factors in recent years are attributable to strong market fundamentals in Asia.
As the global petrochemical industry emerges from a massive downturn due to the coronavirus pandemic, it is likely that several significant trends – including a push for on-purpose petrochemicals production, a focus on hydrogen as a key feature of a net carbon-neutral world and efforts to reduce petrochemical waste in the environment – will draw the attention of global players. For industry participants and policy-makers in Canada, these promise to be issues which present abundant opportunities and no shortage of challenges in the domestic market.
End Notes
1 Petrochemicals defines a diverse group of chemical products that are derived from petroleum and natural gas feedstocks. The focus of this paper is the organic sector of the broader chemical industry, which is characterized by its use of hydrocarbons as raw materials.
2 While the complexity of subsequent processing can blur the lines of definition, the first derivatives of base petrochemicals are generally considered intermediates. This group includes glycols, ketones and esters. Any of the plastics, synthetic resins or fibres produced via further processing may be defined as end products.
3 International Energy Agency, “The Future of Petrochemicals: Towards More Sustainable Plastics and Fertilisers,” October 2018, https://iea.blob.core.windows.net/assets/bee4ef3a-8876-4566-98cf-7a130c013805/The_Future_of_Petrochemicals.pdf.
4 Chemical Industry Association of Canada, “2021 Economic Review of Chemistry, “October 2021, https://canadianchemistry.ca/wp-content/uploads/2021/10/2021-Economic-Review-of-Chemistry-CIAC.pdf.
5 Bernard West, Thomas Adams, Clement Bowman, Murray McLaughlin and Paul Stuart, “Canada’s Chemical Industry: Evolving with the Times,” CEP Magazine, October 2019, https://www.aiche.org/resources/publications/cep/2019/october/canadas-chemical-industry-evolving-times.
6 R. W. Ford, “History of the Chemical Industry in Lambton County,” Sarnia Historical Society, https://www.sarniahistoricalsociety.com/story/history-of-the-chemical-industry-in-lambton-county/.
7 Canadian Association of Petroleum Producers (CAPP) Statistical Handbook, “Refinery Closures-Canada.” Accessed September 9, 2021. https://www.capp.ca/resources/statistics/. Between 1982 and 2010, five refineries in Montreal ceased operation, with total capacity of 68,090 m3/day (428.3 thousand barrels/day) of crude processing capacity.
8 Ethylene cracking margin is defined as the cash differential obtained for product ethylene over raw material cost, credits for any co-products and variable manufacturing costs for a notional steam cracking operation. Typical feedstocks for ethylene cracking operations are gaseous or liquid hydrocarbons.
9 Mark Eramo, “Global Basic Chemicals Outlook,” IHS Markit, March 20, 2019, https://ihsmarkit.com/research-analysis/global-basic-chemicals-outlook.html.
10 International Energy Agency, “The Future of Petrochemicals…”
11 U.S. Environmental Protection Agency, “Trash Free Waters.” Accessed October 20, 2021. https://www.epa.gov/trash-free-waters.
12 European Commission, “Global Action on Plastics.” Accessed October 20, 2021. https://ec.europa.eu/environment/topics/plastics/global-action-plastics_en.
13 IHS Markit, “Ethylene Market Outlook Considering the Impact of COVID-19,” September 10, 2020, https://ihsmarkit.com/research-analysis/ethylene-market-outlook-considering-the-impact-of-covid19.html.
14 McKinsey, “Petrochemicals 2030: Reinventing the Way to Win in a Changing Industry,” https://www.mckinsey.com/industries/chemicals/our-insights/petrochemicals-2030-reinventing-the-way-to-win-in-a-changing-industry.
15 International Energy Agency, “The Future of Petrochemicals…”
16 Steam cracking, the traditional source of olefins for petrochemical use, can be applied to a range of feedstocks, from ethane and other natural gas liquids (NGL), to naphtha, a light byproduct of crude distillation in refineries.
17 U.S. Energy Information Administration (EIA), “The United States Expands its Role as World’s Leading Ethane Exporter,” https://www.eia.gov/todayinenergy/detail.php?id=38232.
18 Inter Pipeline Ltd. was constructing a propane dehydrogenation (PDH) and polypropylene (PP) facility at its Heartland Petrochemical Complex near Fort Saskatchewan. It announced in early 2020 that it was seeking an equity partner for the project. Canada Kuwait Petroleum Corporation (CKPC), a joint venture between Pembina Pipeline Corporation and Kuwait’s Petrochemical Industries Company (PIC), had plans for a PDH/PP project in the Fort Saskatchewan region. The project was deferred in March 2020.
19 Nauticol proposed a $1.5 billion plant in Grande Prairie, AB to process three million tonnes/year of methanol, and Canadian Methanol Corporation proposed a $1.6 billion investment for a 1.8 million tonne/year methanol plant in British Columbia. The status of both projects is uncertain.
20 Kelly Cui, “How CTO/MTO Will Affect the Global Olefins Market,” Wood Mackenzie, August 22, 2017, https://www.woodmac.com/news/editorial/how-cto-mto-will-affect-the-global-olefins-market/.
21 There are five announced COTC projects in Asia and one in Saudi Arabia, accounting for over 100 MMT/a (approximately two million b/d) of refining capacity. Estimated COTC conversion of oil to petrochemical feedstocks ranges from 40 to 60 per cent, significantly higher than traditional refinery configurations, which produce 10 to 15 per cent naphtha for adjacent steam cracking. Two COTC projects – the 20 MMT/a Hengli Petrochemical complex and the first phase of the 40 MMT/a Zhejiang Petrochemical complex – started up in 2019.
22 The other main production route for syngas relies on partial oxidation (POX) of coal, coke, biomass or other organic material in a gasification process.
23 Simon Flowers, “Future Energy – Green Hydrogen: Could it be a Pillar of Decarbonisation?” Wood Mackenzie, February 4, 2020, https://www.woodmac.com/news/the-edge/future-energy-green-hydrogen/.
24 Leslie Hook and John Reed, “Why the World’s Recycling System Stopped Working,” Financial Times, https://www.ft.com/content/360e2524-d71a-11e8-a854-33d6f82e62f8.
25 Niki Wilson, “Is Recycling Futile? Alberta’s Blue-bin Boondoggle,” Alberta Views, April 1, 2020, https://albertaviews.ca/is-recycling-futile/.
26 Ibid.
About the Author
Steven Kelly is a Calgary-based energy professional. He most recently served as a permanent member of the National Energy Board, the predecessor agency to Canada’s current federal energy regulator. Steven spent nearly two decades as an independent energy industry consultant with two global insight firms. In these roles, he advised North American and European clients in strategic, commercial and technical engagements. His expertise extends across the full hydrocarbon value chain. Steven started his career as a technical and economics specialist in the Canadian petroleum refining industry. He holds B.Eng. and M.Eng. degrees in Chemical Engineering from McMaster University, and an MBA from the University of Calgary. Steven is a registered Professional Engineer in Alberta.
Canadian Global Affairs Institute
The Canadian Global Affairs Institute focuses on the entire range of Canada’s international relations in all its forms including (in partnership with the University of Calgary’s School of Public Policy), trade investment and international capacity building. Successor to the Canadian Defence and Foreign Affairs Institute (CDFAI, which was established in 2001), the Institute works to inform Canadians about the importance of having a respected and influential voice in those parts of the globe where Canada has significant interests due to trade and investment, origins of Canada’s population, geographic security (and especially security of North America in conjunction with the United States), social development, or the peace and freedom of allied nations. The Institute aims to demonstrate to Canadians the importance of comprehensive foreign, defence and trade policies which both express our values and represent our interests.
The Institute was created to bridge the gap between what Canadians need to know about Canadian international activities and what they do know. Historically Canadians have tended to look abroad out of a search for markets because Canada depends heavily on foreign trade. In the modern post-Cold War world, however, global security and stability have become the bedrocks of global commerce and the free movement of people, goods and ideas across international boundaries. Canada has striven to open the world since the 1930s and was a driving factor behind the adoption of the main structures which underpin globalization such as the International Monetary Fund, the World Bank, the World Trade Organization and emerging free trade networks connecting dozens of international economies. The Canadian Global Affairs Institute recognizes Canada’s contribution to a globalized world and aims to inform Canadians about Canada’s role in that process and the connection between globalization and security.
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