22 June 2004 13:26 [Source: ICIS news]
European olefins producers and users will be benefiting from a key infrastructure development in a few years time - only 10 or so years late.
The sector finally won approval this month from European Union (EU) authorities for public funding of the final pieces of a new propylene pipeline that will link major cracker sites in northwest ?xml:namespace>
Developing infrastructure is a long and tortuous process, particularly in
The EU has finally had its say on the European propylene pipeline project, approving aid from
The approval signals the end of years of debate and wrangling over European petrochemical industry competitiveness and the importance of carrying more material by pipeline – as opposed to road, rail or barge.
The competitiveness argument is well made, as is the assertion that moving less by rail, road and barge has positive environmental and safety implications. The EPDC consortium had sought state aid, though, based also on the argument that the project would provide benefits in terms of industrial development and employment well beyond the bounds of the chemicals sector and to cover startup costs.
This project, so long in the making, demonstrates the problems producers face if they try to work collectively and with regional as well as European authorities to develop something to their advantage. It looks as though, in this instance, they will get there in the end but a great deal is lost along the way. At the outset 15 companies were shareholders of EPDC. Given industry consolidation there are now just over half that number.
Companies understandably hold different views but the economic case for projects of this sort have to be robust. Propylene pipeline links in northwest
The project, and its foreseeable conclusion, therefore, raise questions about how the now wider EU of 25 member states will develop its industrial pipeline infrastructure in the 21st century. The petrochemicals pipeline infrastructure in central and eastern Europe is much less well developed than it is in the west. Producers in the region are consolidating fast and want to be able to lift their competitiveness further.
A challenge for industry players in the new
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