UAE upgrading more naphtha into petrochemicals

Naphtha prices command a respectable premium over crude oil prices. However, these premiums shrunk during the recession and could narrow again as naphtha supplies are forecast to increase globally. Low profit margins for naphtha producers have triggered major chemicals projects in the UAE. This means that UAE needs to upgrade naphtha into petrochemicals, as per Jasem al Sayegh, the general manager of ADNOC’s refining unit Takreer, said the integration of Abu Dhabi’s biggest refinery with petrochemicals plants in the emirate was one of the strategic objectives of its US$9.6 bln (Dh35.26 bln) refinery expansion at Ruwais. The project would also enable Abu Dhabi to satisfy its growing domestic demand for oil products and increase its presence in international markets for products such as petrol and diesel while creating employment for qualified Emiratis. Amid a global downturn in petroleum refining, Takreer last November awarded the main contracts for the Ruwais expansion to four South Korean firms. The expansion will more than double the refinery’s oil processing capacity to 817,000 bpd from 400,000 bpd. The contractors, Samsung Engineering, GS Engineering and Construction, SK Engineering and Construction and Daewoo Engineering and Construction, were chosen for their ability to optimise refinery-petrochemicals integration. The expansion is scheduled for completion by the end of 2013 and to come on stream in early 2014, by which time Abu Dhabi will have more than 900,000 bpd of total refining capacity. The project is expected to increase Abu Dhabi’s naphtha surplus by 50%. About half of that would be piped to Taweelah, the site of a chemicals complex that the government-owned Abu Dhabi National Chemicals Company (Chemaweyaat) aims to complete by 2014. Including additional refining projects under development in Fujairah and Pakistan, the total capacity for refined oil products controlled by the Abu Dhabi Government will augment by 90% from 2011 till 2015, from 20 million tpa to 38 mln tpa. Simultaneously, two top OPEC oil producers, Saudi Arabia and Iran, are also aggressively expanding refining capacity. Abu Dhabi and Saudi Arabia are doing so for similar reasons: both expect domestic demand for transportation fuels to rise sharply in coming years, exceeding their current output capacities. Both are also pursuing gas development to address domestic shortages. That will increase their production of gas condensate, a type of light oil that is high in naphtha and requires refining. Iran’s rush to build oil refineries is spurred by the country’s shortages of transportation and heating fuels and by the threat of new sanctions over its nuclear program. The sanctions would aim to choke off imports of oil products. Mr Habibe, a technical adviser to Abu Dhabi National Oil Company (ADNOC), predicted that ADNOC’s output of natural gas liquids, including condensate, would increase by more than 50% to surpass 18 mln tons in 2015 from less than 12 mln tons this year. ADNOC’s gas production also supplies gas liquids such as ethane and propane that are the feedstocks for a large petrochemicals complex at Ruwais. Abu Dhabi Polymers Company, or Borouge, which ADNOC controls, owns the facilities and is expanding them in a multiphase project.
  More News  Post Your Comment

Previous News

Next News

{{comment.Name}} made a post.




There are no comments to display. Be the first one to comment!


Name Required.


Email Id Required.

Email Id Not Valid.


Mobile Required.

Email ID and Mobile Number are kept private and will not be shown publicly.

Message Required.

Click to Change image  Refresh Captcha