IPA recently held the “Jornada de la Industria Petroquímica” 2023. What were the main themes?

The chemical industry must tackle two key challenges: plastics circularity and decarbonization. In Argentina, this challenge comes atop of unstable economic conditions and raw material supply insecurities. At the same time, this new paradigm also presents the country with opportunities. Since Argentina mostly relies on natural gas as a feedstock, our industry has a better carbon footprint, which gives us a headstart. As the second-largest shale gas deposit in the world, Vaca Muerta has attracted significant attention. What does the development of LNG mean for the country’s petrochemical industry?

The country is moving in the right direction with the promotion of more domestically produced gas, but to transport more gas (methane) and to develop methane exports (as LNG), we need to extract the liquids from the gas. These liquids - ethane, propane, butane, and naphtha - are petrochemical feedstocks. With the production of LNG debottlenecked, we are moving more into this second phase of industrializing liquid gases. Vaca Muerta and the beginning of LNG exports will generate expansion in the polymers space, and there is already a lot of noise from various players looking at brownfield expansions to leverage this opportunity. For example, Campaña Mega has already presented a significant expansion for exporting liquids. How prepared is the Argentinian petrochemical industry for the circular economy?

The new circular feedstock is plastic waste, something that has never been part of the petrochemical value chain before. The transformation of plastic waste into raw materials is a gamechanger and the industry is rapidly developing advanced recycling capabilities to complement mechanical recycling. YPF has presented a case study for integrating the traditional petrochemical business within a chemical recycling framework, a first in Argentina. The country is clearly moving in the right direction, but we are still only just starting. What is the policy framework to support circularity in the country?

In Argentina there is no regulation on recycling yet, but technology sometimes moves faster than regulators do. 2023 is an election year, slowing down legislation, but I believe a new legal framework for plastic recycling is likely to be drafted in the coming years. In Europe, regulatory changes gave way to a new generation of entrepreneurs. We can already see within our own membership as IPA that non-petrochemical players are joining our leagues – for example, one of our newer members is a waste management company looking after the largest landfill in Buenos Aires. At IPA, we work closely with universities, R&D centers, and other companies to strengthen the recycling ecosystem in preparation for all these changes. How is persisting hyperinflation impacting the petrochemical sector in Argentina?

High inflation creates a significant challenge for imports. However, with the development of a domestic gas supply network, Argentina will see a big change in its current account balance; the availability of local LNG will benefit not only the petrochemical industry but also agriculture and mining, both highly dependent on chemical imports. One of our members, Profertil, is investing in the production of green and blue ammonia, complementing its grey ammonia production. Both Argentina and Brazil import a lot of urea, so developing ammonia in the country will be a great step forward in the fertilizers value chain. I am confident that Argentina will regain its economic balance, though we never know for sure with all the political variables. Do you have a final message for our audience and APLA members?

IPA is positive that we will see significant structural changes in the short term. Gas production is not a mere idea, it is a reality already happening. No matter who wins the election, everyone sees the industrialization of Argentina’s raw materials as a priority for the growth of the country. At IPA, we are working towards building an ecosystem of talents and technologies. This year we are running the fourth edition of our postgrad online course (Diploma in Petrochemical Business) with Universidad Austral, the number one private university in the country. With our partners at PLAQUIPI, we also offer virtual technical courses that have been completed by over 1,000 people to date. IPA offers both executive-level and technical-level training to make sure we have the best-in-class professionals to unlock the opportunities in the petrochemical industry.