GCC to put $39bn into petrochemicals
“The petrochemicals industry has witnessed an unprecedented era of development over the past two decades, which is expected to continue in the near future,” said Abdul Rahim Naqi, Secretary General of the Union of GCC Chambers of Commerce and Industry.
The body is co-sponsoring a two-day petrochemicals conference in Abu Dhabi on January 20 and 21, titled “Petrochemical Sector: a vision for 2020”, in which industry ministers and scores of other officials, businessmen and industrialists from the six-nation GCC will discuss investments in the sector. “There is a wide consensus that the Gulf region is set to play a leading role in the global petrochemical industry in the 21st century,” he said in a statement, sent to Emirates Business from the Union’s offices in Dammam.
Naqi expected the six GCC members, which are already major petrochemical producers, to invest more than $40bn into new projects in the next three years – more than $13bn a year. He said ethylene production will be the focus of the new ventures and such projects would lift the total output of the chemical in the GCC and Iran to nearly 20 per cent of world production.
GCC states of the UAE, Saudi Arabia, Kuwait, Bahrain, Qatar and Oman have already pumped in excess of $70 billion into their petrochemical sectors, nearly 60 per cent of their total industrial investment of around $120 billion.
The projects are part of an ongoing programme to expand and diversify the industrial base of these oil-reliant economies. The industrial sector has been the main target of this programme, due to the presence of vast energy resources in the region and the relatively small size of the local farming and tourism sectors given the desert topography.
Petrochemical projects in the Gulf are more feasible than in other areas given the its location in a vast consumer region and its immense gas resources, which account for more than 40 per cent of the world’s total proven gas wealth.
General Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Commander-in-Chief of the UAE armed forces, will address the two-day conference, which will attract key global personalities, including former German Chancellor Gerhard Schröder, and Joseph Stiglitz, the 2001 Nobel Laureate in Economics and former Chief Economist and Senior Vice-President of the World Bank.
Naqi said the conference would provide an opportunity for GCC industrialists to discuss joint public-private petrochemical projects with the Industry ministers of member states. “The conference will include an open debate with the ministers and provide an opportunity for industrialists to raise some questions,” he said.
He gave no details of the new petrochemical projects in the GCC but according to the Organisation of Arab Petroleum Exporting Countries (OAPEC), all member states have embarked on new ventures or have plans to set up new units.
In the UAE, new projects will add more than two million tonnes to existing petrochemical capacity, including major expansions by Borouge, a joint venture between the Abu Dhabi National Oil Company (ADNOC) and Borealis.
In Saudi Arabia, projects under construction and planned ventures will add more than 10 million tonnes of capacity by the end of 2009 to maintain the Kingdom’s position as one of the world’s largest petrochemical producers.
Kuwait and Qatar will add more than one million tonnes each in the next three years while Oman is pushing ahead with its $1.2bn Sohar petrochemical complex, which will have an output capacity of nearly 800,000 tonnes a year.
Follow Emirates 24|7 on Google News.