Egypt's EIPC to export 80% of its PET resin output

NEW DELHI (ICIS news)--Egyptian Indian Polyester Co (EIPC) will export 252,000 tonnes/year of polyethylene terepthalate (PET) resin, 80% of its total planned capacity of 315,000 tonnes/year, project financier International Finance Corporation (IFC) said on Friday.

The 20% balance would cover the need of the domestic market, which was currently met through imports.

The IFC, the private sector finance arm of the World Bank, is yet to sign financing agreements with EIPC’s Indian promoter South Asian Petrochem Limited (SAPL).

IFC had approved the proposal to lend $20m to EIPC and make an equity investment of $6m in SAPL, which would use this money for equity participation in EIPC. The SAPL board then allotted IFC a 9.9% equity stake in the company.

The $135m project would be the first PET plant in North Africa and would have the advantage of a low-cost logistic base for exports to the EU and North America.

EIPC is slated to commission the plant by March 2010 at Damietta on Egypt’s Mediterranean coast.

Of EIPC’s $34m equity, 70% would be chipped in SAPL, 23% by Egyptian Petrochemical Holding Co (Echem) and the balance 7% by Engineering for the Petroleum & Process Industries (ENPPI), a subsidiary of Egyptian General Petroleum Corp (EGPC).

EIPC would require 275,000 tonnes/year of purified terephthalic acid (PTA) and 60,000 tonnes/year of monoethylene glycol (MEG). Both these intermediates would be outsourced.

SAPL operates an export-oriented PET resin plant at Haldia in India's West Bengal state.

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