By Malini Hariharan
With start-up delays, commissioning issues and operating troubles becoming increasingly common across the Middle East and many parts of Asia, I have been asking industry players on what they think are the major issues that companies are facing.
At the top of the list is the shortage of skilled manpower. We have been hearing a lot about this for the last five years. The shortage during the engineering and construction phase of petrochemical projects during 2005-08 is well documented.
But starting-up huge cracker complexes with a number of derivative units (PE,PP, MEG etc) also requires experience and skills - both of which are in short supply. Given this, they say, the problems are inevitable.
"A start-up [of a cracker] is (always) a tricky situation. Almost everyone faces problems; you have to be lucky to cut-in feed and get on-spec product in 48-72 hours," said a source at a leading petrochemicals company.
"A few have achieved if basic engineering has been done well and the commissioning staff is good.
A second factor is lack of familiarity with some of the newer technologies.
A source at a regional polyolefins producer says design and construction issues have also affected operations.
"Many of the plants were built at a time when raw-material costs were at their peak and some compromises were probably made," he said.
"I have been hearing of vessels and pipes corroding within a few months of start-up while older plants have been running for years without any issues."
A source at an engineering company thinks this is very much possible.
"Compromises could have been made in projects that were awarded on a lump sum turnkey (LSTK) basis just prior to the economic boom period of 2005-07."
And there is yet another reason for start up delays.
"Contractors can achieve mechanical completion of a plant on time but the client has to be prepared for start-up," says the source from the engineering company.
"He has to arrange for utilities and raw materials. If the client is not prepared or inexperienced then delays happen."
Even after a plant has successfully been commissioned, there are other issues that often affect operations.
This second source cited difficulties in coordinating work between sub-contractors and cultural issues as more locals from the Middle East countries have entered the work force.
"Many of the locals do not have experience in operating plants; their culture is also different from expats who have traditionally managed plants," he added.
But companies are working hard to resolve problems. Experienced engineers are being recruited to run the plants.
Another source from a petrochemical company said that Indian engineers over the age of 50 were being offered jobs to manage petrochemical plants in the Middle East.
"Earlier, only engineers in the 30s used to go. Age is no longer a bar," he added
It may take a while but companies should eventually get it right. That's when we will see the full flow of material - an event the industry has been fearing for a long time