Saudi Arabia to invest USD91bn in petrochemical sector in next 10 years

MOSCOW (MRC) -- Saudi Arabia has earmarked USD91bn over the next decade to build new petrochemical plants and expand existing ones, alongwith integrating refineries with new or existing units in the Kingdom
refinery-saudiThe Kingdom has created lucrative business opportunities in its plastic and petrochemical industries, said Oilreviemiddleeast.


The GCC nations also aimed to achieve a production capacity of over 100mn tonnes of petrochemicals per annum by 2015.

According to Riyadh Exhibitions Company, Saudi Arabia has experienced a robust growth in its economy in recent years with a growth of around four per cent anticipated for the financial year 2014-2015. The country has also diversified its business interest to various other sectors in a bid to lessen its reliance on its oil-based economy.
However, in order to sustain this expansion, the Kingdom has created lucrative business opportunities in its plastic and petrochemical industries. In fact, Saudi Arabia is the only GCC country to allow private investment in the petrochemical sector with several incentives such as affordable energy, low-cost raw materials and advanced industrial infrastructure, especially in Yanbu, the organiser added. This has led to growth in plastics and petrochemicals from less than USD0.5bn in 1985 to USD22 bn in 2011.

In order to throw more light on Saudi Arabia’s two primary economic sectors, the Riyadh Exhibition Company will hold Saudi Plastics and Petrochem — the 12th International Plastics and Petrochemicals Trade Fair in Jeddah from 1-3 March 2015 at the Jeddah Center for Forums and Events to highlight cutting edge technologies and products in petrochemicals and plastics sectors.

Organisers have confirmed the participation of Saudi Basic Industries Corporation (Sabic) as the diamond sponsor along with Rabigh Refining and Petrochemical Company (Petro Rabigh) as the gold sponsor.

The exhibitors would get an opportunity to showcase their solutions and services to a broad audience comprising diplomats and high-ranking government officials, industrialist and manufacturers, distributors, suppliers and retailers, industrial engineers, and purchasing and operations managers.

Saudi Plastics and Petrochem 2015 will be held concurrently with Saudi Print and Pack 2015.

As MRC wrote before, the Linde Group was awarded a contract to build the world’s largest carbon dioxide (CO2) purification and liquefaction plant for Saudi Basic Industries Corp. (SABIC). The plant will be located at Jubail Industrial City in Saudi Arabia. The plant will be designed to compress and purify around 1,500 tpd of raw carbon dioxide coming from two nearby ethylene glycol plants. The purified gaseous CO2 will be pipelined through the piping corridor of the Royal Commission of Jubail to three SABIC-affiliated companies for enhanced methanol and urea production.
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MOSCOW (MRC) -- Fans of cigars, rum, Caribbean travel and more than a few Major League Baseball managers celebrated at the White House announcement of plans to normalize relations with Cuba after nearly 55 years of embargo, said Plasticsnews.

But the manufacturing sector, including the plastics industry, isn’t toasting with authentic Havana Club just yet.
There are still plenty of obstacles for anyone hoping to do business with or in Cuba. The White House announcement came as a surprise, even for those keeping a close eye on U.S. foreign policy.

"No one that I know of had been brewing up a Cuban market entry plan and now it’s just a matter of dusting it off," said Michael Taylor, senior director for international affairs and trade at the Society of the Plastics Industry Inc. in Washington.

Any segment of the plastics industry will have to start from scratch, making a business case for a move into a market about which very little is known to any U.S. businesses. Materials suppliers are unlikely to go in and try to put in capacity, Taylor said, though the lure of a new market may draw in processors, if a business case can be made — and if Congress allows it.

"The embargo that’s been imposed for decades is now codified in legislation," President Obama said in his Dec. 17 address. "As these changes unfold, I look forward to engaging Congress in an honest and serious debate about lifting the embargo."

The 1996 law known as the Helms-Burton Act, and five other existing laws, severely restrict any U.S. commerce with Cuba that is not related to humanitarian relief. There is also still ample animosity on Capitol Hill toward President Raul Castro and his brother, Cuban revolutionary and longtime leader Fidel Castro, particularly among Cuban-Americans in the Republican party, which will control both chambers of Congress in 2015.

And just because the United States has not done business with Cuba in more than five decades does not mean the rest of the world has been shut out of the Castro regime. Cuba has been a member of the World Trade Organization since 1995. Cuba does have its own plastics industry, though little is known of it in the U.S. market.
In January 2014, Brazil’s Groupo Odebrecht signed on to build a plastics conversion plant in the Mariel Special Development Zone, where the global infrastructure and construction giant is already building a $957 million container port.

And last April, the Cuban government said it was moving forward on a USD1.4 billion natural gas regasification project and a USD1.2 billion urea and ammonia plant with help from Petrolos de Venezuela SA (PDVSA). Though no construction timeline is available, the anticipated 400,000 metric tons per year of urea and 370,000 metric tons per year of ammonia to be produced are meant to benefit Cuba’s plastics, agriculture and chemical industries, according to a PDVSA release at the time, with the Venezuelan company exporting the excess to other Caribbean and Central American countries.

Perhaps the biggest area where improvement in U.S.-Cuba relations could help and influence plastics is the island nation’s recycling industry. While governments like Cuba’s are not known for being particularly green, tourism is already a large government-controlled business there. Helping keep beaches and waterways plastic-free with recycling and clean-up programs could be a way to build goodwill and ties between U.S. and Cuban industries and trade groups, and even individuals.

As MRC wrote before, Russian oil companies Rosneft and Zarubezhneft were set to sign a deal to explore a block off Cuba. The two could sign the deal to develop Block 37 within the next week following a state visit to the Caribbean island nation. The news wire cited Yuri Ushakov, an aide to President Vladimir Putin, as saying that he intends to visit Cuba starting on Friday, where it is hoped the companies will sign the agreement with state oil player Cubanpetroleo (Cupet).
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MOSCOW (MRC) -- Idemitsu Kosan Co., one of Japan’s largest refining and petrochemical companies, and Showa Shell Sekiyu are holding talks as falling demand for fuels prompts some of Japan’s largest refiners to consider consolidation, as per Hydrocarbonprocessing.

Idemitsu, Japan’s third-largest refiner by capacity, is looking at "realignment of businesses" it said in a statement to the Tokyo Stock Exchange on Dec. 20. Showa Shell is considering tie-ups and is holding talks with Idemitsu, according to a separate statement.

Idemitsu may bid as much as 500 billion yen (USD4.2 billion) to buy Showa Shell, a 30% premium to the company’s market value as of last week, the Nikkei reported.

Royal Dutch Shell is the largest shareholder of Showa Shell, with a 33% stake, and is inclined to accept an Idemitsu bid, Nikkei said. Royal Dutch Shell declined to comment.

A unit of Saudi Arabian Oil Co., or Saudi Aramco, owns 15% of Showa Shell, according to data compiled by Bloomberg. Calls to Saudi Arabian Oil’s office in Tokyo outside business hours weren’t answered.

We remind that, as MRC wrote before, Idemitsu Kosan will be shutting its refinery in Japan for maintenance turnaround in April 2015. It is likely to remain off-stream for around one month. Located at Chiba in Japan, the refinery has a crude processing capacity of 220,000 bpd.

Idemitsu Kosan is a Japanese petroleum company. It owns and operates oil platforms, refineries and produces and sells petroleum, oils and petrochemical products. The company runs two petrochemical plants in Chiba and Tokuyama. The two naphtha crackers can produce up to 997,000 tonnes of ethylene per year.
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MOSCOW (MRC) -- Honeywell's UOP announced today that PetroChina Guangxi Petrochemical Co. (GXPC) is using UOP process technology to purify hydrogen at a new refining complex in Qinzhou, Guangxi Province, said Hydrocarbonprocessing.

With support from UOP’s local service team, GXPC successfully commissioned a UOP Polybed PSA (Pressure Swing Adsorption) system to purify hydrogen, which is a critical ingredient used in modern refining processes to produce clean transportation fuels, including diesel, gasoline and jet fuel.

GXPC is subsidiary of PetroChina, one of China’s largest state-owned enterprises. Refineries use hydrogen to convert heavy oils to lighter, higher-value products such as transportation fuels. Hydrogen is also used to remove contaminants and improve the quality of end products.

The PSA unit at GXPC processes feed from a steam reformer to produce more than 140,000 Nm3/h (normal cubic meters per hour) of hydrogen. In addition to PSA technology, GXPC is also using several other UOP technologies to produce high-quality fuels, including: CCR Platforming technology, two-stage Unicracking technology, Unionfining technology, hydrotreating technology, Penex technology, and fluid catalytic cracking technology.

Since UOP commercialized the first small, four-bed hydrogen PSA system in 1966, the company says it has significantly improved Polybed PSA systems by incorporating several generations of technological advancements. New generations of adsorbents, enhanced cycle configurations, modified process and equipment designs, and more reliable control systems and equipment – combined with decades of operational expertise — have resulted in higher performance and reliability, and improved operability at a lower cost.

Earlier this year, UOP announced it supplied 1,000th PSA unit. The Polybed PSA system is a skid-mounted, modular unit that comes complete with hardware, adsorbents, control systems and embedded process technology. The process uses proprietary UOP adsorbents to adsorb impurities at high pressure from hydrogen-containing waste streams and subsequently reject them at low pressure.

The UOP system provides 99.95% on-stream reliability in supply of 99.9% purity hydrogen, according to company officials. In addition to recovering and purifying hydrogen from steam reformers and refinery off-gases, Polybed PSA systems can be used to produce hydrogen from other sources, including ethylene off-gas, methanol off-gas and partial oxidation/syngas.

As MRC wrote before, PetroChina planned to spend more than 10 billion yuan (USD1.6 billion) on shale gas this year. PetroChina's decision to triple its shale gas spending from expenditures on the unconventional fuel over the past few years comes just months after Sinopec lifted hopes that China is near a breakthrough by announcing a commercial find. PetroChina has also lifted its 2015 shale gas output target to 2.6 billion cubic metres, up from the previous 1.5 Bcm, according to a company official and a government source cited by the news wire. That would represent only about 2.3% of China's total natural gas output of around 113 Bcm last year.
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MOSCOW (MRC) -- Honeywell's UOP has announced that China has commissioned the first of 14 planned propylene production units, using technology from UOP to help close the global propylene supply and demand gap, reported Hydrocarbonprocessing.

China’s Zhejiang Satellite Petrochemical Co. became the first Chinese producer to start production of propylene using UOP C3 Oleflex process technology, which efficiently produces propylene from propane.

Zhejiang Satellite Petrochemical is currently producing high-quality, on-spec product for acrylic acid and derivative production, according to UOP officials.

Traditionally, propylene is a byproduct of making ethylene. However, a shift in how ethylene is produced globally has meant less propylene byproduct is being produced, sparking investment in technology to create propylene from propane.

Since 2011, UOP has licensed the C3 Oleflex process to more than a dozen producers to meet rising demand, with a majority of licensed capacity in China.

"China's propylene consumption accounts for more than 15% of worldwide demand and is growing at about 5% to 6% per year," said Pete Piotrowski, senior vice president and general manager of UOP's process technology and equipment business. "Oleflex technology has been demonstrated to have the lowest cash cost of production due to its efficiency, providing a significant operating advantage to our licensees, and we look forward to showcasing the commercial success of this technology in China."

Zhejiang Satellite Petrochemical will produce 450,000 tpy of propylene at its facility in Pinghu City in Zhejiang Province. Zhejiang Satellite Petrochemical, formerly known as Zhejiang Julong Petrochemical Co. (ZJLPC), produces materials used in various markets, including aviation, automobile production, oil mining, health care and textiles.

As MRC wrote earlier, last year, OOO Kirishinefteorgsintez selected Honeywell to supply its experion process knowledge system (PKS) and advanced alarm manager system at the company"s refinery in Kirishi, in the Leningrad region of Russia.

Kirishinefteorgsintez is the only refinery in the North-West of Russia, which makes all kinds of fuel, a wide range of petrochemicals, including polystyrene (PS). The project processing capacity of the plant is 19.8 million tpa of oil. The company is a part of Surgutneftegas.
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