Iran to Receive Gasoline from Reliance

Reliance is reportedly transporting gasoline into Iran through Petronas. This becomes a dispute as the Indian refiner has previously instructed traders not to transport its gasoline into Iran following President Barack Obama new push toward international sanctions against Iran.

Reliance has been seen to be prepared not to become a prime target for US legislators which may result into potential punitive measures by the United States.

Petronas would be the second firm after Kuwait’s fuel supplier IPG making deliveries into Iran. It is possible that Petronas through its subsidiary Petronas Trading Corporation (Petco) is selling Reliance gasoline cargo through another trader which may have excluded the additional clause.

Shell Opening Up Chemical Plants in Qatar

Shell, together with Qatar Petroleum is planning for chemical plants project in Qatar. The two companies already have a gas-to-liquid (GTL) project at Ras Laffan producing 120,000 barrels per day of natural gas liquids and 140,000 barrels per day of GTL derivatives.

The chemical project was announced informally by Ben van Beurden, Shell Chemicals' executive vice president duringf the 4th Gulf Petrochemicals and Chemicals Association (GPCA) summit.

Kuwait Reviving US$14 Billion Refineries

Kuwait will be reviving its US$14 billion project which will see new fourth oil refinery, previously on hald in March due to corruption allegations. The refinery targeting production of 615,000 barrels a day was earlier planned to be built by Japanese and South Korean companies.

The allegation which accuses government officials profiting from the project due to bypassing of central bidding committee was denied by the Kuwait government.

BP CNPC & Exxon Petronas Bidding for Rumaila Field

Oil giants U.K BP PLC with its pair China National Petroleum Corp. and U.S. oil major Exxon Mobil Corp. and Malaysia's Petroliam Nasional Bhd, or Petronas are bidding for joint offers to develop Iraq's Rumaila oil field.

Despite Iraq's long black history with the western world, the country is holding Iraq's first bidding round in 30 years for Rumaila future development oil field. Rumania's current output capacity is 1 million barrels a day, in which the Iraqi government persuing to increase by up to 1.75 million barrels a day by getting foreign participation into the country.

Dow & PIC Setting up a JV Petchem

Dow Chemical and Kuwait’s Petrochemical Industries Co (PIC) have been reportedly signing a mutual agreement for a $17.4 billion K-Dow petrochemicals joint venture. It is estimated that K-Dow would generate $11 to $15 billion annual sales with the new JV which includes Dow's existing joint-ventures MEGlobal and Equipolymers. 

The 50:50 JV company will use Dow's strength from its olefins and polyolefins capacity turning it to be a major producer of petrochemicals and plastics including polyethylene, ethylene amines, ethanolamines, polypropylene and polycarbonate. K-Dow is also seen to be one of the important polypropylene technology and market related catalysts licensor.

NPC Iran to Start-up New PDH Plant

Iran's National Petrochemical Co (NPC) will be starting up its new 350,000 tonne/year propane dehydrogenation (PDH) plant at Bandar Imam, Iran, by 2011 which is currently under construction. So far the propylene product has no outlet for derivative downstream other than planned polypropylene (PP) units at Bandar Imam. It was also reported that phenol-acetone projects are currently underway at Bandar Imam, Iran.

Plastic Futures Available December in Dubai

The Dubai Multi Commodities Centre (DMCC) and the Dubai Gold and Commodities Exchange (DGCX) will be launching the first ever Middle East and Asia plastics futures contracts targeted to be live in December 2008. The products for the Future Exchange will be polypropylene (PP) and linear low density polyethylene (LLDPE). More plastic derivatives will be inlcuded in the near future.

The futures will be backed up by physical deliverable in warehouses. DMCC selected various locations for the warehouses including Jebel Ali in Dubai, Busan and Gwang Yang in South Korea, Pasir Gudang and Tejung Pelapas in Malaysia, and Singapore.

Middle East Petchem Market Review

Despite the recent financial hiccups in the global market, the Middle East countries continue with exports as usual in 2008.  It looks as if the situation does not affect the demand for Middle East petchem.

This is mainly due to the substantial cost advantage (feed stock advantage) the region has over other producers. In addition to that, many of the countries are booming with new capacity addition of petrochemical plants, boosting competition. Demand for 2008 is expected to remain high despite there is a potential slower growth in the Western world affecting mostly ethylene demands.

Shipyards are also busy with new ships being built pushing supply down on top of other underlying problems such engineering and the design process. 

MOPCO Took Over Agrium Fertilizer Project

After months of delay, Egypt’s MISR Oil Processing Company (MOPCO) has agreed to acquire EAgrium joint-venture fertilizer project making EAgrium a subsidiary of MOPCO. Under the new deal, Agrium would own 26% of the combined project, including MOPCO’s recently completed 675,000 tonne/year urea plant as the acquisition is based on share swapping.

The Egypt Fertlizer project worth $1.2 billion was delayed on 21 April due to local resistance with Egyptian government was rumoured to take over the whole project.

South America Gets Iran's Ethylene Tender

Iran's National Oil State - Iran Petrochemical Commercial Co (IPCC) has sold a tender worth 5kmta ethylene cargo to a South America buyer priced at around $1,800/tonne on a cost and freight (CFR) basis

It was marked as exceptional as most  southeast Asia buyers are bidding at low $1,300s/tonne CFR level. Speculative talks indicate cargo destination to Venezuela from Assaluyeh and/or Bandar Imam Khomeini (BIK).

Yara Formed Joint-Venture with NOC Fertiliser

Norway’s Yara has signed major agreements with National Oil Corp (NOC) and the Libyan Investment Authority (LIA) to form a joint venture for the production and marketing of mineral fertilizers

The JV comprise of 50% stake by Yara and remaining owned by LIA and NOC. The JV was setup to upgrade existing ammonia and urea production plants with capacity of approximately 700,000 tonnes/year of ammonia and 900,000 tonnes/year of urea located at Marsa el-Brega and additional new fertilizer plants.

Shell Seeking JV Partners for Styrene Monomer/ Propylene Oxide Latest Technology

Shell Chemicals is seeking potential joint venture partners for its new styrene monomer (SM) and propylene oxide (PO) facility. The chemical plant is expected to cost in the region of $500 million which is to be built in Southeast Asia or Middle East with a world-scale capacity for Asia Pacific demand.

The chemical will be producing mainly PO with SM as co-products hence having higher flexibility and financial advantages due to current strong propylene oxide value chain.

Natpet's Yanbu Project Gets US$ 125 Million Loan

Saudi National Petrochemical Industries Company (Natpet) has signed a financial agreement with Saudi General Investment Fund for a $125m loan which will be used to finance the company project in Yanbu.

The project consists of a Spheripol PP technology from Basell petrochemical plant with capacity of 400,000 tonnes/year propylene and polypropylene.

Jubail Petchem Company Established by Aramco and Total

Saudi Arabian Oil Co (Saudi Aramco) and France’s Total have signed a joint venture Petrochemical Co for a 400,000 bbl/day capacity Jubail Refining. The refinery is expected to begin operations by 2012 producing diesel and jet fuels, 700,000 tonnes/year of paraxylene, 140,000 tonnes/year of benzene and 200,000 tonnes/year of polymer-grade propylene.

The refinery is in its close proximity to the Arabian heavy crude supply system and closeby to the Jubail Industrial City's King Fahad Industrial Port, power and water grids, and residential areas.

Gulf Cooperation Council (GCC) Nations Investing $200 Billion

It is estimated that as much as $200 Billion will be invested by the Gulf Cooperation Council (GCC) nations are via 14 to 20 energy projects as the energy demand is increasing. This is much helped by the rising surge in the crude oil price.

Previous analysts estimate that fear due to possible US economic recession or the mortgage market have yet to see any decline of energy funds and a negative impact on GCC countries if not helping to fuel the investment demand.

As much as 20% of the $200 Billion will be invested in downstream petrochemical plants and complex in the Gulf Nation such as Saudi Arabia, Qatar and other booming Middle Eastern countries. New petrochemical capacities in the Middle East are growing at an exponential rate and is expected to continue at least until 2012.

Oman Octal Building new PET Chemical Plant

Omani-based Octal Petrochemicals is planning a new polyethylene terephthalate (PET) resin capacity of 300,000 tonnes/year and is due to start up in the fourth quarter of 2008 in Salalah.

Environmental Concern Grows at Egyptian Fertilizer Plant

Canada-based fertilizer producer, Agrium who owns a $1.2bn Agrium joint-venture nitrogen fertilizer plant in Egypt, is working to address concerns on the environmental impact of the chemical plant towards the nearby community at port of Damietta.

The fertilizer chemical plant is scheduled for completion in 2010 with capacity of two 1,200 tonne/day ammonia plants and two urea plants of production capacities of 1,925 tonnes/day.

Progress Heating Up at Al-Jubail Petrochemical Complex by Saudi Kayan

Saudi Kayan Petrochemical Co (Kayan) who is reportedly going worldwide scouting for employees has awarded all the contracts to build its mega petrochemical complex which now stands at 73% progress.

The petrochemical complex at Al-Jubail will produce 6m tonnes/year of petrochemical products including ethylene, propylene, monoethylene glycol (MEG), polypropylene and other chemicals due to be commissioned late this year.

SABIC Ar-Razi New Methanol Plant On-Stream in May

Saudi Basic Industries Corp (SABIC) joint venture mega methanol plant in Saudi Arabia, Ar-Razi 5 is expected to come on stream in May as per schedule. Rumours have spread that there was insufficient gas for the plant lagging the on-stream date.

Saudi Methanol Co, a joint venture of SABIC and a Japanese consortium will have a total capacity of methanol 5.7 million tonnes/year if the new mega methanol chemical plant is on-stream at Al-Jubail.

$1 Billion Petrochemical Complex Project by Saudi OSOS

Saudi Arabia's Osos Petrochemicals is planning to develop its estimated $1bn polybutylene terephthalate (PBT) petrochemical complex. The earlier plan was to include Saudi Basic Industries Corp (Sabic) for a 35% stake but SABBIC withdrew from the project.

The chemical plant will be located at Yanbu on the Red Sea coast with capacity of 60,000 tonnes/year of PBT, 50,000 tonnes/year of butanediol, 3,500 tonnes/year of tetrahydrofuran, and 85,000 tonnes/year of maleic anhydride acid. For the cost of $1 billion for the construction, analysts are considering the cost to be a bargain.

The polybutylene terephthalate (PBT) complex is in commercial phase with EPCC (engineering, procurement and construction contractors) for award of contracts in the end of the third quarter of 2008. A few contractors including Oslo-based Aker Kvaerner with China's Sinopec, and South Korea's GS Engineering & Construction, Samsung Engineering Company and Hanwha Engineering & Construction are currently in the bidding process for the award of construction contract.