Dow suspends talks with Qatar Petroleum, carries on with other Mid East projects

02-Nov-06

Due to a revision of priorities, Dow has suspended talks with Qatar Petroleum (QP) about a proposed petrochemical JV in Qatar. However, Dow will carry on with its other projects underway in the Mid East region. Dow Chemical and Petrochemical Industries Co (PIC), Dow's Kuwaiti partner in the Equate petrochemical complex, have been evaluating plans to construct a 1 mln tpa ethylene complex, signing a preliminary deal with government controlled Egyptian firm EGPC to study opportunities for a joint venture on Egypt's Mediterranean coast. The partners still await Egypt's assessment of its resources and projects that should be prioritized. In light of surging project costs in the Middle East; Dow, Oman Oil Co (OOC) and the Omani government are weighing the next step for their proposed petrochemical joint venture at Sohar, Oman. The cost of the project for construction of a gas-fractionation unit for supplying C2, C3 and C4 feedstock was originally estimated at about US$2.6 billion. Total production capacity will be pegged at 1.4 mln tpa of propane, butane, and C5-plus fractions for export. The project will supply ethane to a proposed ethylene cracker with a capacity of 800,000 - 10,00,000 tpa. The project was originally scheduled for completion in 2008-2009, but changes indicate it will be completed 'not before 2010'. The cracker will supply feedstock to three large polyethylene lines. Dow also has a joint venture project for refining and petrochemicals with Saudi Aramco at Ras Tanura in Saudi Arabia. The two companies will initially hold equal stakes in the project, but will subsequently hold a 35% stake after a planned listing of a 30% interest on the Saudi stock exchange. A detailed feasibility study is expected to start at the end of the year, and the complex could go onstream in 2012-2013. It will have a combined olefins capacity of about 1.5 mln tpa of ethylene and 1 mln tpa of propylene, and will include an upgrade of Saudi Aramco's 325,000 bbl/day refinery at Ras Tanura, among other activities.