EPCA ’06: Dow targets power, ethane at Aramco jv

26 September 2006 13:04  [Source: ICIS news]

By Nigel Davis

 

MONTE CARLO (ICIS news)--Dow Chemical is planning power generation facilities, ethane extraction and chemicals production at its proposed Ras Tanura joint venture with Saudi Arabia’s Aramco, the US company’s head of hydrocarbons & energy, Theo Walthie, said on Tuesday.

 

Speaking to ICIS news on the sidelines of the 40th EPCA, Walthie said the proposed refinery, gas, energy and chemicals complex is a next generation venture with a wholly new production model.

 

The venture will be integrated with Aramco’s 550,000 bbl/day refinery at Ras Tanura and involve the construction of new power generation facilities, ethane extraction capabilities and chemicals production plants.

 

Dow hopes to sign a memorandum of understanding (MoU) for the project within the next five to six months.

 

It would come on-stream from 2012, Walthie suggested, and after the entry to the market of many of the petrochemicals projects currently planned for the region.

 

“This will lead to probably the largest complete chemicals combination,” Walthie said, and involve a significant commitment on both sides.

 

The potential cost of the project has not yet been publicly identified.

 

This would be a new strategic model for the sector, Walthie suggested.

 

Exxon Mobil’s production model, for instance links refineries closely to petrochemicals plants. Others are seeking closer such refinery/chemicals integration. Most petrochemicals projects in the region currently are ethane plays.

 

“This will not be done overnight,” Walthie said, but will introduce a full chemistry package to Saudia Arabia, including chlorine based products.

 

“It will be a long trip,” he added.

 

Dow Chemical would hold 35% of the venture and Saudi Aramco 35%, with Saudi public investors holding the remaining 30%.

 

The partners do not preclude the involvement of other players downstream in the project, particularly as there are plans to build a so-called value park for further chemicals production at the location.

By: Nigel Davis
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