Sabic suspends building of naphtha cracker

12-Jun-06

The contracting and constructing market has become overheated due to the glut of large investment projects in oil, gas and energy worldwide, This has lead to very high investment costs and financial risks, causing Sabic to postpone building a naphtha cracker in Geleen, south of the Netherlands. A year ago, investment costs estimated by Sabic stood at around 1.5 billion euros. However, at current market rates, the estimates have risen to more than 2.0 billion euros. The project called for a major expansion to the company's existing cracker at Geleen, adding some 400,000 tpa of capacity through a so-called side cracker.The plans also included a major polyolefins expansion both at Geleen and also at the company's site in Gelsenkirchen, in Germany. In all, three units covering both PP and PE, were included in the scheme.