Unichem/Herdillia for Saudi cumene

25 November 1996 00:00  [Source: ACN]

SAUDI Arabia is firming the details of its first cumene project with a capacity of 350-400 000 tonne/year. Local company Unichem and Indian phenol producer Herdillia Chemicals are to be the major shareholders.

The project's first phase - to produce 260 000 tonne/year - is to start up at end-1997 in Yanbu. The second phase will be a 90-140 000 tonne/year expansion in 1998.

In the US$50-60m first phase, Herdillia will offtake 100 000 tonne/year of product and Bukaka Group subsidiary Kumenindo Kridanusa in Indonesia will offtake 160 000 tonne/year, a Unichem official told ACN.

Unichem is still discussing with Phenolchemie and Sumitomo Chemical for offtake from the second phase. The latter two have expressed interest in equity participation.

The first phase will require 100 000 tonne/year of propylene and 160 000 tonne/year of benzene as feedstock. Saudi Aramco in Yanbu will supply 100% of the propylene requirement and Sabic's 350 000 tonne/year Cyclar project will supply the benzene.

The project is part of the Al-Yamamah programme set up by the British Offset Office. The programme is designed to transfer technology to Saudi companies through either joint ventures or licensing agreements.

The shareholding structure will be confirmed within the month. In the tentative structure, Unichem has a 50% share, Herdillia 25-30%, the Bukaka Group 10-15%, and the British Offset Office 10%.

UOP's Q-max process will be used for the first phase.

A major cost-saving factor for the project is the Saudi Industrial Development Fund, which provides a package of finance and non-finance incentives, the official said. It makes available project finance of up to 50% of the project cost at a nominal, preferential rate.

Chem Systems has undertaken the feasibility study. The project will require 18 months to implement.

Herdillia intends to use the cumene for its 100 000 tonne/year phenol and 60 000 tonne/year acetone project in Dahej, Gujarat, India. Startup of this facility will be linked to the completion of the Gujarat Chemical Port Terminal in Dahej. The terminal is expected to be completed in Q3 1999.

Herdillia is also studying a bisphenol-A facility in Dahej as the second phase of its phenol project. The facility will come onstream in 2000. Herdillia's existing 26 000 tonne/year phenol facility in New Bombay consumes 40 000 tonne/year of cumene.

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