MOU for multi-billion dollar petrochemicals project inked between USA and Egyptian companies

01-Jul-11

An MOU for a multi-billion dollar petrochemicals project was signed by prominent US and Egyptian companies, as per Dailynewsegypt.com. Basil El-Baz, founder and CEO of Egypt Basic Industries Corporation (EBIC), as well as Chairman and CEO of Carbon Holdings, inked the first of a series of agreements for the development of a US$3.5 bln naphtha cracker and olefins complex project that will be jointly developed with US companies. Financed by the Export-Import Bank of the United States, the mega project is expected to create some 3,000 jobs. According to the United States Trade and Development Agency, which hosted the forum and oversaw the signing of the MOU, the first phase of an ambitious 20 year plan to develop Egypt’s petrochemical industry at an overall cost of US$10 bln was completed in 2008 at a cost of US$3.8 bln. Majority of the existing petrochemical plants are producing under-license from US companies, which have a market share of approximately 26%. Market demand for petrochemicals in Egypt is estimated at 6% pa. In 2009-10, Egypt produced 1.8 mln tpa of petrochemical products worth US$768 mln; 836,000 tpa of which were exported worth US$373 mln. Equipment for petrochemical factories have historically been imported primarily from the UK, US, Italy, and the Far East, often depending highly upon feasibility study requirements and/or recommendations.