Mideast still has light feeds for incremental growth − executive

26 March 2014 21:19 Source:ICIS News

HOUSTON (ICIS)--The Middle East still has enough light feedstock available to expand its capacity incrementally, even though the region's upcoming large projects will rely on heavier raw materials, an executive with Saudi Aramco said on Wednesday.

Although the Middle East has substantial reserves of natural gas, much of it is dry gas, so it lacks the natural gas liquids (NGLs) that can be used as a cracking feedstock.

The NGL feedstock that did supply the region's initial petrochemical plants was gas that would have normally been flared, said Warren Wilder, executive director, chemicals, downstream for Saudi Aramco. Wilder was speaking to the IHS World Petrochemical Conference.

Those NGLs have once would have been flared are now being converted into petrochemicals, Wilder said.

As one consultant noted a few years ago, the Middle East has run out of easy ethane.

Wilder stressed that there are still incremental supplies of NGLs available, and these are being put into use.

Nonetheless, Wilder said that new projects in the Middle East have shifted towards heavier feedstocks.

Looking ahead, new plants will also concentrate on higher margin, value-added products such as acrylonitrile butadiene styrene (ABS), synthetic rubber, polycarbonate (PC), polyols and amines, Wilder said.

This is a change from the region's past focus on commodity chemicals and resins, he said.

Feedstock supplies will remain reliable and stable, he said.

"Saudi Aramco will continue to be a reliable supplier," Wilder said.

Kuwait and Saudi Arabia will remain the largest petrochemical producers within the Gulf Cooperation Council (GCC), he said.

The region's greatest challenge is a shortage of skills, Wilder said. Private and public partnerships will be necessary to address this skill gap.

By Al Greenwood