GPCA: Oman set to invest

22 November 2012 16:27  [Source: ICB]

ICIS editor John Baker interviews Musab Al Mahruqi, CEO of Oman's Orpic, on a range of issues from trade and logistics infrastructure to feedstock availability in the country.

"Ethane extractable from natural gas along with other light petrochemical feedstock available in Oman is sufficient to launch a worldscale petrochemical project in Oman" Musab Al Mahruqi CEO, Orpic

• With global economies under continued pressure from low growth, there has been a move to erect trade barriers once again. Do you see this affecting the Gulf petrochemical producers at the moment, and how? Can you cite specific examples?

The global economies continue to witness an uneven pattern of growth. While the mature economies like the US and eurozone are witnessing a low or a negative growth, the Asian economies are showing a healthy growth. Such imbalance does point at a scenario where trade barriers can be erected to protect own interests. The Gulf petrochemicals industry continues to be the largest producer and exporter in the world, accounting for 11% of the $600bn (€470bn) global petrochemical industry. The Gulf's market share is expected to touch 17% in the next five years. More than 13% of polyolefin global polyolefin supplies are produced in the Gulf Cooperation Council (GCC) region.

Recent examples of trade barriers that come to my mind are that of India imposing antidumping duty on Oman for polypropylene (PP) even though the exports to India from Oman were negligible. Just a month back, Turkey announced an increase of 3% in the import duty on PP originating from the GCC.

• What remedies can Middle East chemical producers seek out, via GPCA or their respective governments? Have you had any successes in this respect?

GPCA can play a [more] important and proactive role than it has done so far to protect the interests of its members.

• Polymer exports from Gulf producers are expected to continue to grow substantially over the next five years - is the Gulf shipping and rail infrastructure sufficient to accommodate the increased trade?

A feasibility study will inform the company's downstream expansion

There is certainly room for improving the shipping and rail infrastructure in the Gulf region. Several steps are being taken by member countries, one of them being the [GCC] rail project [connecting Kuwait right down to Oman]. The port infrastructure is also being upgraded. Some problems are being experienced currently in this area.

• In terms of feedstock availability, are natural gas and associated ethane supplies sufficient to support further petrochemical investment in Oman and other smaller Gulf states?

The ethane extractable from natural gas along with other light petrochemical feedstock available in Oman is sufficient to launch a worldscale petrochemical project in Oman.

• What plans does Oman have at present to expand its downstream petrochemicals production? What role does Orpic play in this?

Oman is actively engaged in adding value to its crude oil as per His Majesty's Vision 2020. The second oil refinery in Oman was setup in Sohar in 2006. Simultaneously a PP project was setup. The aromatics plant went into production in 2010. The three units which existed independently earlier have now been integrated to form the new entity Oman Oil Refineries and Petroleum Industries Co (Orpic).

Orpic has already announced an improvement project for its Sohar Refinery. Other downstream projects may be added after the feasibility study has been completed.

• Is the Duqm project further defined now in terms of petrochemical slate - what is the timescale for this development?

Orpic is not associated with the Duqm project. The feasibility study is being conducted by Oman Oil Co.

By: John Baker
+44 20 8652 3214

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly