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March 29 (Peninsula) -- Qatar hopes to
soon become the regional hub of petrochemical industry and plans are afoot to
raise production from the current 18 million tonnes a year to 30 million tonnes
by 2014.
This has been disclosed by Dr Mohamed Al Mullah, General Manager of Qatar
Petrochemical Company (Qapco), in an interview with Qatar News Agency (QNA). He
added that investments in Qapco currently total $1.7bln and are expected to jump
to an incredible $12bln by 2012. Given a booming petrochemical industry in the
Middle East, Qatar will become an important regional hub, Al Mullah noted,
explaining that Qapco was producing 800,000 tonnes of ethylene annually and 400,000 tonnes of low density
polyethylene (LDPE), besides 70,000 tonnes of sulphur.
The company has been meeting a considerable part of Middle East requirements
of ethylene whose plant is being upgraded. Expansions underway would allow Qapco
to raise LDPE output to 700,000 tonnes annually by 2011 while
production of ethylene would reach 1.4 million tonnes per annum, Al Mullah said.
The company’s products have become more competitive in the European Union (EU)
countries thanks to a reduction in EU taxation rates to 3.5 percent following
coordinated efforts by Qatarand other GCC countries.
Qapco currently has a global marketing network with 26 offices and three
regional storage facilities extending the company’s services to many countries
around the world, especially in the Middle East and Asia. Al Mullah said that
Qatar is becoming one of the major producers of petrochemicals in the region,
besides Saudi Arabia, other GCC countries and Iran. Iraq is expected re-enter
into the field when it rebuilds its oil industry that had been ravaged by years
of war, said Al Mullah. Global petrochemical prices have recently improved, the
Qapco general manager added, anticipating good profits for the company. He said
an upswing in prices in the near future was expected, given the current
stability in crude oil prices.
Al Mullah said that the world financial crisis adversely impacted oil prices
and in turn the prices of petrochemical products as well. However, the impact on
Qapco profits was limited, given the boom in the industry in the pre-crisis
period. The impact of the crisis was also cushioned by the fact that the primary
feedstock for ethylene production, that is, gas, is produced in Qatar and
available at reasonable prices, besides the presence of Qapco’s marketing
network in many parts of the world, though the global petrochemical industry had
been seriously hit by the crisis, leading to plant closures and a decline in
consumption. This has left producers with lower profits.
However, despite the crisis, Qapco’s thrust continues to be on expansion. The
company has signed an agreement to set up an LDPE plant at a cost of QR2bn. It will be completed by
2011 and produce 300,000 tonnes of LDPE per annum. Besides, Qatofin , a Qapco
subsidiary which has a production capacity of 450,000 tonnes a year, had started
LDPE production in November 2009, Al Mullah noted.
Qatofin represents Qapco’s competitive edge in global markets. It is 36 percent
owned by Qapco, 36 percent by France’s Total and one percent by Qatar Petroleum.
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