Total and Aramco mull Jubail cracker project

08 June 2010

Two companies are already building a refinery at Jubail

Total is in talks with Saudi Aramco over developing a major new petrochemicals project at Jubail on the kingdom’s Gulf coast.

The pair are building a joint venture 400,0000 barrel a day (b/d) refinery at Jubail Industrial City 2 under the name Saudi Aramco Total Refining and Petrochemical Company  (Satorp). Construction contracts for the project were awarded in 2009.

The Satorp partners have started discussing the construction of an integrated mixed-feed cracker at an adjacent site within the industrial city, say Michel Govaerts, general manager of new business development for the Middle East and North Africa at Total at MEED’s Middle East Petrochemicals 2010 conference in Abu Dhabi on 8 June.

Gulf ethylene production capacity 2000-2016
20007,200
20028,600
20049,500
200611,300
200816,100
201024,900
2012f30,400
2014f31,900
2016f31,900
f=Forecast.  Source: Gulf Petrochemicals and Chemicals Association, Nexant Chem Systems

“We are working on a potential cracker project with Aramco at Jubail,” says Govaerts. He declined to give details of the likely scope of the project. He said, however, that it was likely to be world-scale, and in line with other projects of a similar size, which produce 1.5 million tonnes a year of the basic chemical ethylene and 500,000 tonnes a year of propylene.

Aramco already plans to build one petrochemicals complex at Jubail Industrial City 2, an estimated $17bn joint venture scheme with the US’ Dow Chemical, which was originally set to be built at Ras Tanura.

It remains unclear what the scope of this project will be, as the partners are reworking designs for the scheme which are likely to be based on the use of the gas ethane as the predominate feedstock rather than the crude oil product naphtha, which offers poor margins. However, it is also expected to take some liquid feedstocks fro the Satorp project.

MEED reported in March and April that the partners planned to move this project from Ras Tanura to Jubail as part of plans to bring down the cost of the development and a major restructuring of Aramco’s planned refinery projects (MEED 23:4:2010). Dow and Aramco are in the process of finalising a deal over the site with the Royal Commission for Jubail and Yanbu (MEED 3:6:2010).

The decision came as a surprise to Total, says Govaerts.

“This project needed to move to Jubail and we were a little surprised at Satorp,” he says. “We were a bit frustrated to see someone moving in next to the refinery.”

Govaerts believes, however, there is sufficient space at the site, and feedstocks available for Aramco, for more than one petrochemicals project to be developed at Jubail.

“Jubail is a big site,” says Govaerts. “Hopefully there will be enough room for two crackers at Jubail Industrial City 2.”

A MEED Subscription...

Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications