London +4420 814 42225
Moscow +7495 543 9194
Kiev +38044 599 2950

Our Clients

Order Informer

Home > News >

PKN Orlen plans major expansion of petchems, renewables

December 02/2020

MOSCOW (MRC) -- PKN Orlen (Plock, Poland) will invest an average of 4.4 billion zloty (USD1.2 billion) per year between 2021 and 2030 on a major expansion of its integrated petrochemicals business and the creation of a plastics recycling division as part of an enhanced strategic focus on petchems and renewables over the next 10 years, according to Chemweek.

By 2030 it will have an annual petchems output of approximately 15 million metric tons, and be “an active player” in plastics recycling with 300,000-400,000 metric tons/year of installed capacity, PKN Orlen says. The strategic expansion is forecast to increase its petchems EBITDA from Zl 2.3 billion in 2019 to approximately Zl 7.0 billion by 2030, according to the company. “We are set to become one of Europe’s largest integrated petrochemical producers and expand our recycling business,” it says.

The capital expenditure (capex) plans, outlined in its latest strategy update, are being implemented to achieve targets including expanding the share of specialty products in its petchems portfolio from 16% in 2019 to 25% by 2030, and ramping up its production capacities for olefins and other base chemicals in order to supply feedstock for the development of the specialty and other advanced petchems products. The increased focus on petchems will specifically include expanding its position in products such as phenol and other aromatic derivatives, it says.

A chart in an accompanying strategy presentation shows planned petchems investment focused initially on base chemicals between 2021 and 2023, with a growing focus on advanced petchems products from 2022 to 2028.

By 2030, around half of the company’s profits from crude oil processing will be derived from its petchems business, according to PKN Orlen.

In polymers the company is aiming to strengthen its position and extend its value chain to include compounding and concentrates, as well as “building [a] foothold in sustainable development” through mechanical and chemical recycling of plastics and the development of waste-to-energy solutions, while also implementing advanced closed-loop technologies, it says. PKN Orlen had no plastics recycling capacity in 2019. It also plans to build a lactic acid unit. Recycling and biomaterials will be new branches of its petchems segment, it says.

PKN Orlen has set an overall capex program of Zl 140.0 billion for the period to 2030, with Zl 85 billion to be spent in new areas, such as petchems and renewables, including hydrogen and biofuels. A total of Zl 55.0 billion will be spent on key existing assets, mostly in refining, to increase their efficiency and extend their life cycle in order to maximize performance.

Approximately Zl 3.0 billion will be spent over the period on innovation and R&D, with a focus on green technologies, it says.

The strategy update highlights the company’s focus on implementing an energy transition path by 2030, “charted around renewable energy and advanced petrochemicals,” it says. “Business diversification efforts will be driven by maximized profits from the group’s existing core business, to be transformed based on new technologies, in line with the emerging environmental and consumer trends.” PKN Orlen’s long-term objective is for net zero carbon emissions by 2050. It has previously announced a target of reducing emissions by 20% from its existing refining and petchem assets by 2030, and by 33% from its power generation business.

“We are building a new multi-utility group capable of successfully competing at a time of major transformational change. We are fully aware that the business segments being our strongest suit today will require a profound change, for which we are well prepared. Over the recent years, we have taken consistent steps to effectively strengthen the Group, preparing it for the imminent transformation,” says Daniel Obajtek, PKN Orlen’s president.

Refining will remain an "important segment" of the company’s business until 2030, driven by energy efficiency improvements, increased crude conversion rates, and integration with Grupa Lotos. Expansion of biofuel and hydrogen fuel output will be another vital driver, it says.

As MRC reported earlier, earlier this year, Honeywell announced that PKN Orlen plans to use the UOP Q-Max and Phenol 3G technologies to produce 200,000 metric tons per year of phenol at its facility in Plock, Poland.

Phenol is one of the main feedstocks for the production of bisphenol A (BPA), which, in its turn, is used for the production of polycarbonate (PC).

According to MRC's ScanPlast report, Russia's estimated consumption of PC granules (excluding imports and exports to/from Belarus) rose in the first three quarters of 2020 by 32% year on year to 75,600 tonnes  (57,200 tonnes a year earlier). And although in the injection moulding sector, the market dropped by 5% with consumption of 7,300 tonnes year on year (7,700 tonnes), it increased by 39% in the extrusion sector to 67,400 tonnes (48,600 tonnes a year earlier). The blow moulding sector grew in January-September 2020 by 1% year on year to 880 tonnes (870 tonnes a year earlier).
Author:Margaret Volkova
Tags:bioplastics, bisphenol a, PC, acetone, crude and gaz condensate, phenol, blow moulding, injection moulding, sheet extrusion, petrochemistry, PKN Orlen, Poland, Russia.
Category:General News
| More

Leave a comment

MRC help


 All News   News subscribe