Mega petrochemical projects in the Middle East to boost production

Mega projects in the UAE, Saudi Arabia and other Arab countries will sharply boost the region's petrochemical production in the next few years. Saudi Arabia, the world's oil basin, could become the largest global petrochemical producer when its output surges to nearly 110 mln tons in 2015, as per a report by the Organisation of Arab Petroleum Exporting Countries (Oapec) as reported in business24-7.ae. Oapec groups 10 major Arab oil and gas producers. Production of ethylene is currently estimated at just over 10 mln tpa which will rise to nearly 23 mln tons by 2013, by expansions of existing projects as well as new ventures. The report states that the petrochemical industry in the Arab region has been passing through an unprecedented boom reminiscent of the boom in late 1970s. This is due to several factors including the availability of massive gas resources, a large consuming market, a strategic location between eastern and western markets and the intensifying efforts undertaken by regional governments to develop non-oil industries and diversify their economies. At the end of 2007, total Arab ethylene production stood at around 10.04 mln tons, accounting for only about 8.4% of the world's ethylene output of nearly 119.5 mln tons… but new projects in the region will expand the Arab output capacity by 23 mln tons, more than double the current output. This means the Arab region is poised to become a major petrochemical producer in the coming period given its massive hydrocarbon resources that will enable it to create an advanced petrochemical industry." Oapec's figures showed the petrochemical industry in the Arab world had largely developed over the past few years and the bulk of the increase has come from Saudi Arabia, the UAE, Kuwait and Qatar. Other Arab nations are also carrying out propylene projects, including Kuwait, Libya and Egypt. From about 3.2 mln tons in 2005, ethylene output in Saudi Arabia was expected to have peaked at over 8 mln tons at the end of 2009. Production was set to soar from 600,000 tons to 1.8 mln tons in the UAE, from less than 200,000 tons to 2.5 mln tons in Qatar and from about 500,000 tons to nearly 1.5 mln tons in Kuwait. Propylene production was also projected to have shot up from just 700,000 tons to 2.5 mln tons in Saudi Arabia, and from zero to just below one mln tons in the UAE. The report showed production of polyethylene was also expected to have exceeded 4 mln tons in Saudi Arabia by the end of 2009 and nearly 1.5 mln tons from about 500,000 tons in the UAE. The kingdom's output stood at around 45 mln tons at the end of 2006 and was projected to reach 75 mln tons by the end of 2009. In 2015, its production is forecast to surge to 110 mln tons to account for nearly 10% of the world's total petrochemical output… Saudi Arabia is already the world's third largest producer of urea. Oapec gave no figures on Arab investments in petrochemicals but estimates by its affiliate, the Arab Petroleum Investment Corporation (Apicorp), showed around US$110 bln could be pumped by the Mena region during into petrochemicals and other downstream gas industries during 2009-2013.