Let me give just a basic quick overview for people who don't know the chemistry industry well. You might wonder in the back of your mind why we have a chemistry industry in Alberta. People say it's the oil. No, it's not the oil; it's the natural gas liquid.
There are two pathways to make traditional industrial chemicals. One is to take crude oil, turn it into naphtha, and then turn that into plastics-related chemicals. The other is to take ethane out of natural gas and go straight into chemicals for plastics in all the plastics chain. We call ethane a natural gas liquid. It comes along with the natural gas developments.
What's the benefit of that? It uses half as much energy, and therefore results in half as many emissions, to make plastics and all related petrochemicals out of ethane rather than naphtha. That's not to say that naphtha's wrong—there are a lot of very important chemistries that are based on naphtha—but the plastics chain can be well supplied from ethane.
Why does Alberta have a strong industry? It is because, for years, it was the only place in North America that had access to ethane. It was cost-effective to produce plastic-related chemicals in Alberta and ship them over the mountains or ship them back across Canada.
What has happened in the U.S.? Why is there a revolution? Well, they now have access to the same ethane we've had for a long time. In fact, in Sarnia you have seen the installations there convert their operations, which are historically naphtha-based, to the ethane feedstock. That has made them very competitive vis-à-vis their U.S. counterparts, but we should be able to attract more of that investment here.
Another way to ask the question is, “Well, what does the U.S. have that we don't have?” We have access to feedstock; they have access to feedstock. We're a little worried about the long term if we don't develop energy, but for now, feedstock is available. We have access to market; they have access to market, both the North American market and the Asian and offshore markets.
The third thing the U.S. has that we don't have, especially at the state level, is a competitive investment environment. On many occasions it has seemed that Canada hasn't been interested. If you look no further than Pennsylvania, which doesn't have the long, storied history of chemical development Canada does, Shell Chemical has proposed a project there that will amount to well over $10 billion U.S. That was seven years of work. The State of Pennsylvania was not going to take no for an answer. It was a question of how to make this happen for the 40 years of benefits, tens of thousands of workers in construction, and 800 to 1,000 good jobs after that. The question was, “How do we make this happen for Pennsylvania?” That deal was concluded this year.
There's a message here for Canada: there's a very competitive global environment for investment. If we want it, we're going to have to go for it, and we're going to have to work very hard to get it.