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Published: 1977

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Among the many factors complicating locational analysis of the petrochemical industry are (1) the infinite number of process combinations possible in a large petrochemical complex; (2) the difficulty of quantifying agglomeration economies which characterize the industry; (3) the large number of products defined as petrochemicals (some of which tend to be raw-material-location-oriented while others are market-oriented). One of the most important changes the petrochemical industry is undergoing is the current shift in feedstocks. Now that natural gas is becoming costly and scarce, new production facilities will no longer be based on the light feedstocks such as ethane, but will instead be based on heavier feedstocks such as gas-oil and naptha. In this analysis, the authors attempt to outline the locational factors that will be most relevant to petrochemical producers of the future. The divergence of opinion over the effects and magnitude of the energy crisis or the future impact which environmental lobbying will have an petrochemical location makes it impossible to make projections with certainty. Consequently, they try to make explicit their assumptions and the uncertainty involved in some of these assumptions so that the reader can easily adjust their estimates in light of alternative hypotheses. Wherever possible, they rely on published predictions by industry experts. 36 references, 17 figures, 11 tables.