The Gulf Petrochemical and Chemical Association’s (GPCA; Dubai) annual forum, attended by more than 1,800 delegates, kicked off in Dubai today with networking and an industry seminar presented by IHS Chemical. Sanjay Sharma, managing director/Middle East and India at IHS Chemical, says that new feedstock allocations to companies in the region have decreased and that feedstock pricing policy is uncertain. Also, governments within the Gulf Cooperation Council have shifted to favor chemical subsidiaries of national oil companies or their joint ventures with foreign partners, such as Sadara and Petro Rabigh. Independent chemical companies, which include Sabic, Tasnee, Advanced and Sipchem, are expected to lose out, leading to reduced investments. In the last decade, the Mideast has built up an enormous petrochemical industry, but, going forward, only nine cracker projects are likely to be implemented in the region through 2022, Sharma says. These include Sadara, a jv between Saudi Aramco and Dow Chemical; Borouge 3; two cracker projects in Qatar; Olefins III in Kuwait; Orpic in Oman, two Kavyan lines in Iran; and a project in Iraq. Shale gas in the United States is posing competition, as are coal-chemicals projects in China. Clustering and innovation are ways forward. “Innovative companies enjoying long-term success in the chemical industry will be those that are able to leverage technology alongside low-cost supply strategies to meet demand at the right cost with the right products using the right go-to-market strategies,” says Mark Eramo, v.p. of IHS Chemical. Sharma says that Mideast producers sitting on a pile of cash should be acquisitive and actively explore investments outside the region. “We expect them to take the cash they are sitting on and go shopping for facilitate growth, Sharma says.
Posted on: Thu, 21 Nov 2013 00:05:00 +0000
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