Industries in Middle East switch to heavier feedstocks on expected ethane shortage

07-Mar-14

Middle Eastern industries are shifting from using ethane as a primary feedstock to heavier slates including condensate, butane and propane to prepare for a potential ethane shortage in coming years, the CEO of Petrochemical Industries Co., has said as reported by Platts. According to the Gulf Petrochemicals and Chemicals Association, the region's natural gas demand is expected to fall 51 billion cubic meters short of supply in 2015, due to over-expansion of downstream plants such as ethylene derivatives like polyethylene and monoethylene glycol. The integration is likely to cut storage costs for producers and ease fuel and power shortages in the region. However, the challenges of such integration will increase the complexity of operations and limit operational flexibility, he said, adding that the Middle Eastern industry's advantage will come from scale, new hardware, technology and access to financing.The company predicts non-ethylene-based chemicals to rise to a 50% share of the Middle East's base chemical capacity by 2020, from 30% in 2013.