Qatofin signing awaited for Q-Chem II

26 April 2002

Qatofin, a 64:36 joint venture between Qatar Petrochemical Company (Qapco)and France's Atofina, is expected to sign a joint venture agreement in May to participate in the ethylene cracker to be built as part of the Q-Chem II development at Ras Laffan. Under the proposed shareholding structure, Qatar Chemical Company (Q-Chem)will have a 55 per cent stake in the cracker with the remaining 45 per cent held by Qatofin (MEED 12:4:02).

Qatofin signed in early October a memorandum of understanding to participate in the Q-Chem II cracker. However, Qatar Petroleum (QP), the majority shareholder in both Qapco and Q-Chem, subsequently looked at the possibility of building two grassroots ethylene complexes - Q-Chem II and Qatofin - as a result of a projected increase in ethane feedstock from upstream gas developments in the North field. It has now reverted to the original plan of proceeding with a world-scale, shared cracker, which can be expanded when additional ethane supplies become available (MEED 19:10:01).

Q-Chem will use the output from the Ras Laffan cracker as feedstock for new ethylene derivative units to be built in the industrial city. Qatofin is planning to take its share of ethylene production and deliver it via a new pipeline to Mesaieed, where it will be used as feedstock for a new 450,000-tonne-a-year (t/y) linear low density polyethylene (LLDPE) plant. To be owned by Qatofin, the LLDPE unit will be integrated into the existing Qapco complex.

Qapco is already moving ahead with the expansion of its own facilities. Engineering, procurement and construction (EPC) bids were submitted in mid April for two new furnaces, which will be installed as part of the programme to boost the company's ethylene capacity to 720,000 t/y from the existing 525,000 t/y. Bidders for the contract include Stone & Webster, part of US-based Shaw Group, and Germany's Linde. Once the contract has been awarded in the third quarter, Qapco is expected to issue a second EPC tender, which will cover the balance of work on the upgrade.

Qapco will use the additional ethylene production to top up supplies to its neighbour, Qatar Vinyl Company. Some of the output will be exported, while the remainder will be used by Qapco as feedstock for an expansion of its own low density polyethylene capacity. Under a planned debottlenecking programme, existing polyethylene capacity will be raised by 50,000 t/y to 430,000 t/y.

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