Fracking: It’s Really About the Chemicals

Sept. 15, 2015

Most of the public’s attention around the energy revolution driven by “fracking” has focused on the lower cost of oil for consumers. This is no small matter: I filled up for $1.96 a gallon last night.

However, an even more significant development driven by fracking has been occurring outside the view of most folks. It involves natural gas- and petrochemicals.

Our era has been defined by the unpredictable actions of men like Wright, Fleming, Edison, Jobs, Salk, Ford, and Borlaug. It is clearly now time to add another name to our Pantheon: Nick Steinsberger.

On June 11, 1998, Steinsberger, a 34-year old petroleum engineer working for Mitchell Energy, unleashed one of the biggest waves of creative destruction in the modern era.

On that day, as told marvelously by Russell Gold in his brilliant book The Boom: How Fracking Ignited the American Energy Revolution, Steinsberger used powerful amounts of injected water - instead of the industry-norm gel- to crack the shale beneath S.H. Griffin Well #4 in North Texas.

A few days later, to the astonishment of everyone, the well was producing more natural gas than could ever be imagined. As Gold observed, “…Steinsberger had given birth to the modern frack industry. He had figured out how to force shale to give up its gas.”

The impact of Steinsberger’s breakthrough- and later developments in horizontal drilling- created a world that is radically different from the past.

As little as 12 years ago, grave concerns were being raised that that U.S. would not be able to meet her natural gas needs. Imports of liquefied natural gas spiked, and it appeared America was going to add natural gas to its list of foreign addictions.

In response, many U.S. industries tied to petrochemicals headed out the door to produce overseas. Those who stayed behind significantly reduced their footprint.

When things seemed to be only getting worse, the unforeseen revolution launched by Steinsberger started to take hold.

Today, America is awash in natural gas – and the vital elements it contains.

Hydraulic fracturing brings both petroleum and natural gas to the surface.

The petroleum and gas are then separated, with the oil sent to refineries for processing. The natural gas is broken down into methane, ethane, butane, heptanes, hexane and propane. These serve as the “mother’s milk” for so many indispensible aspects of our lives. 

  • Methane is critical for electrical generation and producing heat in our homes, kitchens, and offices. It is also essential in producing fertilizers.
  • Ethane is the critical building block of ethylene: the main component of plastics.
  • Butane has many applications, including as a liquid fuel; a propellant for aerosol sprays; and, a base for the production of other petrochemicals.
  • Heptanes is widely used in the manufacturing of paints, sealants, and pharmaceuticals.
  • Hexane can be found in chemicals that are used to make shoes, leather products, and roofing. These chemicals can also be also used to extract cooking oils (such as canola oil or soy oil) from seeds; for cleansing and degreasing a variety of items; and, in textile manufacturing.
  • Propane is used primarily as a heat source.

The widespread availability of natural gas here in the United States is re-writing the rules of global business.

Industries such as fertilizer production, which had all but abandoned the U.S. when natural gas supplies nearly dried up, are back. No ammonia plants—which produce the vast majority of the fertilizer used worldwide—had broken ground in the U.S. for more than 20 years.

Starting in 2014, there were 14 new ammonia plants underway in the U.S., with nearly 12 million tons of new capacity and $30 billion of expected investment. Several older plants are also being re-commissioned and upgraded.

In a remarkable turnaround, the U.S. is set to become the world’s leading fertilizer manufacturer- and exporter- by 2020. 

With lower domestic natural gas prices and increasing availability, U.S. manufacturers are now more competitive than international suppliers in many industries, even with the strengthening Dollar.

In another remarkable shift, energy companies like Cheniere LNG are building multi-billion liquefied natural gas terminals on the Gulf of Mexico to export overseas.

While most people focus on the price of oil when it comes to the energy revolution, it really is much more about the gas – and the chemicals.

About the Author

Andrew R. Thomas | Bestselling business author & associate professor of marketing and international business

Andrew R. Thomas is Associate Professor of Marketing and International Business at the University of Akron; and, a bestselling author/editor of 25 books.

His newest work is The Canal of Panama and Globalization: Growth and Challenges in the 21st Century (2022).

His book The Distribution Trap: Keeping Your Innovations from Becoming Commodities was awarded the Berry-American Marketing Association Prize for the Best Marketing Book of 2010.

Andrew is founding editor-in-chief of the Journal of Transportation Security; contributing writer at Industry Week; and, a regularly featured analyst for media outlets around the world such as BBC, CNBC, and Wall Street Journal.

A successful global entrepreneur, Dr. Thomas was a principal in the first firm to ever export motor vehicles from China. He has traveled to and conducted business in 120 countries on all seven continents.

His personal website is

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