13 May 2011 06:08 [Source: ICIS news]
(updates details on new complex throughout, analyst comments)
By Nurluqman Suratman
According to a PETRONAS statement, investment costs for the project have been estimated at around $20bn (€14m), with the complex expected to be commissioned by the end of 2016.
The country’s prime minister, Najib Tun Razak, on Friday outlined details of a feasibility study for the development of the refinery and petrochemical integrated development project (Rapid) in southern Johor.
A petrochemicals and polymer facility is also planned for the production of propylene and ethylene oxide derivatives, phenol and bisphenol A (BPA), differentiated polypropylene (PP) and polyethylene (PE), as well as surfactants and additives for lubricants, the statement said.
The site will also house C4 and C5 derivatives complexes for manufacturing various grades of synthetic rubbers, it added.
“The proposed project presents an opportunity for PETRONAS to further expand and diversify its petrochemical business through volume growth, a more diversified products base and a move into [the] high value and premium specialty chemicals market,” the statement said.
PETRONAS is also considering building a liquefied natural gas (LNG) receiving and re-gasification terminal within the new Rapid complex to support its development, it said.
“Looking ahead, Rapid is expected to attract significant investments from international companies within and further down the business value chain,” PETRONAS president and CEO Shamsul Azhar Abbas said in a statement.
The project’s development is timely as it will be able to capitalise on the growing demand for energy in Asia, especially from
“Oil companies will still be building new integrated refinery complexes because energy demand is increasing very rapidly in
“The hike in rubber and cotton prices might continue to see new highs in future, so perhaps synthetic materials demand will grow as they are cheaper alternatives,” Kwan said.
PETRONAS’s new complex is expected to pose little threat to other key Asian chemicals hubs, such as
The new refinery will also benefit from the robust global oil industry, which is entering an upswing period where demand and consumption will continue to outstrip supply, said Naphat Chantaraserekul, a Bangkok-based analyst at DBS Vickers Securities.
“We are definitely entering the up-cycle because there is less supply coming online, as compared with the growth in demand [worldwide],” he said.
Global oil capacity stands at 88m bbl/day, with an additional capacity worth 800,000 bbl/day projected to come on stream in 2012. An estimated new capacity of 400,000 bbl/day is already expected this year, Chantaraserekul said.
However, “[these] new capacities coming on line are still short of overall demand, which is now at around 1m-1.5m bbl/day,” he added.
The crude oil refining capacity proposed under the Rapid project is larger than the combined capacities of PETRONAS’s existing refineries in Melaka and Kerteh, prime minister Najib said.
“The proposed petrochemical development also exceeds those of the Kerteh and Gebeng integrated petrochemical complexes in eastern peninsular
The Rapid project is expected to boost
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