Total petchems spend in 2008 to reach $1bn

13 February 2008 17:56  [Source: ICIS news]

LONDON (ICIS news)--Total has earmarked $1bn (€690m) for petrochemicals investments in 2008, group CEO Christophe de Margerie said on Thursday.

The increased expenditure would be for further upgrades to the integrated production platforms in Europe and the US, on ethane-based projects in the Middle East and on Asia, he added.

Total’s strategy to further improve competitiveness in petrochemicals involves concentrating on the major integrated sites in Europe and in the US and also in step-out projects in Asia and those based on ethane. The break-even point of the naphtha-based businesses is being reduced, he said.

The energy giant is restructuring its styrenics activities in Europe and partially closing down operations at the Carling site in France. It is also seeking greater petrochemicals/refining integration.

Two of the group's major petrochemical projects are to be based on ethane, one in Qatar where Total has a 49% stake in Qatofin, a 1.3m/year ethane cracker and derivatives complex currently under construction and due on-stream in 2009.

Its other majored thane-based project is the 1m tonne/year cracker and derivatives complex planned for Arzew, Algeria. Total would have a 51% stake in this project with partner Sonatrach. Start-up is tentatively scheduled for 2013.

Total is also expanding by 30% the Daesan 2.7m tonne/year cracker complex in South Korea in which it has had a 50% stake since 2003.

At the end of 2007, the 700,000 tonne/year Qapco plant in Qatar, in which Total has a 20% stake, was debottlenecked with the addition of 200,000 tonnes/year of capacity.

Total said it expects to have 35% of its capital employed in petrochemicals based on ethane with the start-up of the Arzew plant. By 2015, 50% of its petrochemicals results could be based on ethane or made in Asia, it added.

Total reported on Thursday a 66% drop in petrochemicals profits for the fourth quarter to €87m largely on higher priced naphtha and the weakness of aromatics margins.

($1 = €0.69)

By: Doris Leblond
+44 20 8652 3214

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