In Saudi Arabia, the sector’s traditional regional powerhouse, only two new cracker projects are still firmly in the pipeline as government feedstock allocations dry up. Of the two, the most advanced is the Saudi International Petrochemical Company (Sipchem) cracker at Jubail, with an award scheduled for the end of the first quarter. The second, expected to be tendered towards the end of the year, after a final investment decision is reached, is at the Ras Tunura integrated refinery and petrochemical complex, planned by Saudi Aramco and the US’ Dow Chemical Company.
Elsewhere, Oman, the UAE and Kuwait are unlikely to make any further major upstream capacity additions because of their own gas limitations. Only Qatar, with its massive gas reserves, is substantially ramping up capacity, with Qatar Petroleum and its affiliates planning new crackers with South Korea’s Honam Petrochemical Corporation, ExxonMobil, Shell and possibly Total.
As the pipeline of new upstream chemical schemes slows, project sponsors will be looking at integrating their complexes and securing feedstock supplies. At the same time, the trend towards downstream speciality products will continue. Encouraged by government policy to create a more labour-intensive manufacturing base, a host of new products are likely to be introduced into the region for the first time.
As the Gulf market slows, attention will turn to North Africa. Algiers will continue to develop its $15bn masterplan, following the award of contracts to Total and the local/international Almet consortium for an ethane cracker and methanol plant at Arzew in 2007. The next award is likely to be for a fuel oil cracker at Skikda, with plans understood to be less advanced for a naphtha cracker and propane dehydrogenation complex at Arzew.
A petrochemicals masterplan also worth about $15bn is under development in Egypt. In 2008, Cairo will seek a strategic partner for a $2bn aromatics plant, for which feasibility studies are under way. Among other plans, construction will continue on a polystyrene plant and tenders will be issued for a technology provider for a styrene facility, both at Alexandria.
Egypt is also one of the fastest-growing markets in the Middle East for fertiliser production. Misr Oil Processing Company and Egypt Basic Industries Corporation are due to bring on stream new production facilities that will increase ammonia production by 1 million tonnes a year (t/y) and urea production by 700,000 t/y.
Libya hopes to sign joint ventures with Dow to rehabilitate and expand the Ras Lanuf petrochemicals plant, and with Norway’s Yara International to upgrade and expand ammonia/urea facilities at Marsa el-Brega.
For the sector, 2008 is likely to be the year when the regional petrochemicals industry reaches maturity, no longer focusing solely on commodity chemicals but manufacturing the whole range of products.
Petrochemicals in numbers
$15bn – the amount Algiers is investing in its petrochemicals masterplan
$2bn – Cairo’s planned investment in a new aromatics plant