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Petronas likely to miss March FID target for RAPID project

February 28/2014

MOSCOW (MRC) -- Malaysia's state-owned Petronas faces more delay to its Refinery and Petrochemicals Integrated Development or RAPID project in the state of Johor as it is unlikely to meet its March deadline for a final investment decision, reported Apic-online with reference to The Edge Financial Daily newspaper.

"The project will be further delayed as RAPID's FID will most likely not be approved by the timeline stipulated, which is in March, and Petronas will incur a sunk cost of Ringgit 4 billion (USD1.2 billion)," the newspaper quoted a source as saying.

The reasons for the delay included unresolved community problems over land access in Pengerang and the proposed relocation of cemeteries in the area being met with resistance, the newspaper said, citing another source.

The Ringgit 60 billion RAPID project includes a 300,000 b/d refinery which will primarily supply feedstock to an integrated petrochemicals complex, including a naphtha-fed steam cracker with the capacity to produce 3 million mt/year of olefins.

As MRC informed previously, in July 2013, Petronas signed an agreement with Eni-controlled Versalis to jointly own, develop, construct and operate elastomer plants within Petronas'  proposed refinery and petrochemical integrated development (RAPID) complex in Pengerang, Johor. The agreement signed with Versalis is the fourth-such arrangement secured by Petronas for RAPID. Prior to this, Petronas inked similar agreements with Germany-based BASF, ITOCHU Corp. of Japan and Thailand's PTT for various high value-added downstream chemicals.

Petronas is currently evaluating other potential partners and licensors for the various facilities to be developed within RAPID.
Author:Margaret Volkova
Tags:oil, propylene, ethylene, petrochemistry, BASF, Itochu, Petronas, PTT Chemical, Malaysia.
Category:General News
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