EPCA ’09: Mideast petchems’ biggest challenge is to diversify

04 October 2009 15:51  [Source: ICIS news]

Mideast petchems challenge is to diversifyBERLIN (ICIS news)--The biggest challenge for the Middle East’s petrochemical producers is to diversify their product portfolios and look for newer feedstock options, a regional industry leader said on Sunday.

“The first priority should be to change from commodity driven [market] to speciality products,” Abdulwahab Al-Sadoun, secretary general of the Gulf Petrochemicals and Chemicals Association (GPCA), told ICIS news on the sidelines of the 43rd European Petrochemicals Association (EPCA) meeting.

Al-Sadoun said despite the global economic downturn, the growth of the petrochemical industry in the Middle East had been “phenomenal”, hence putting pressure on the availability of ethane feedstock.

“There is more demand [of ethane] than supply,” he said, adding that there was a need to consider other raw materials including naphtha.

However, he shrugged off perceptions of overcapacity hitting the industry, saying that new plants in the region would find new clients in the wake of the closure of plants in Europe and the US.

“The United States will become a net importer of polyolefins for the first time,” he added.

He said Middle Eastern producers had traditionally relied on the production of basic chemicals but there was a growing realisation to move towards speciality products.

Al-Sadoun said Saudi Arabia had plans for setting up polymer parks to host downstream speciality companies that would also help provide more opportunity to a growing younger population.

“The real potential is in the downstream,” he noted.

He said the GPCA was working with producers on new initiatives such as an awareness campaign for environmental regulations including Reach, that would impact petrochemicals production and sales.

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