UAE petrochemical capacity to treble
Already a global force to be reckoned with, the Middle East’s chemical and petrochemical sector is on the brink of a new era of investment and expansion.
The GCC already produces 30 of the most common intermediate petrochemical products, representing 7% of worldwide production. This is set to increase to 20% of global output by 2010, with Saudi Arabia accounting for almost half of that increase.
The UAE is investing heavily in its petrochemical industry, and will see capacity increase threefold, opening up new opportunities in the downstream and end-use processing sector.
An estimated US$40 billion in new investments is expected in the GCC chemical and petrochemical sector, including non-oil products such as polymer resins, polystyrene and liquid industrial chemicals, by 2010.
According to Abdul Rehman Falaknaz, President of International Expo Consults (IEC), organisers of CHEM Middle East exhibition, this is just the start of a period of rapid growth for the region’s chemicals sector. “With petrochemical facilities in Europe and the US facing cutbacks due to increasingly high prices and shortage of feedstock, the Gulf countries have emerged as the world's first choice for new facilities and best choice for investment in this industry,” Falaknaz says.
The decision of where to locate a new complex is an important one for petrochemical companies. The major staging ground in recent years has been the Middle East, and there seems to be valid reason for international companies to locate facilities in this area.
“The continuing expansion and growth in the Middle East has resulted in a need for more sophisticated logistics and supply chain processes to distribute more than 40 million tons of petrochemicals and plastics to over 70 countries on a plant-to-customer basis,” Falaknaz explains.
“For the next 10 years at least the Middle East will continue to have an edge over others. Beyond that, new technologies may change the way we produce polymers and petrochemicals. Economics will ultimately decide the future,” he adds.
China’s Sunchem group will be joining the China Pavilion at CHEM Middle East to promote its petroleum resin products to the Middle East. “I see the Middle East as a potential future market for our company. At present, we sell around 10% to Middle East, but we want to expand this to 30% in the future,” says Sun Chang Dong, Managing Director, Sunchem Group (H.K.) Company Limited.
Australia-based Cyndan Chemicals is using CHEM Middle East to showcase its new soda blasting technology. The Middle East already accounts for 35% of the company’s total global turnover. Michael Snounou, Business Development Manager, Cyndan Chemicals, predicts an increase in secondary chemical production. Cyndan recently won a contract tender to supply the biggest ship yard in Korea with its rust product, while its New Zealand partner won a restoration project for Auckland City Council, to clean and seal the streetscapes in the city.
Italy’s Debem Srl is looking for a distributor at CHEM Middle East this year. “At the moment, the Middle East market is not well developed in our company. We consider it as a very important business opportunity and that is we want to develop it more,” says Paola Di Vita, Sales Manager, Debem Srl.
This year’s show will see two new sections: Process Technology and Heat and Cooling Technologies, as well as an informative seminar schedule. Dubai Techno Park free zone and RAK Free Trade Zone will also be participating in the show.
CHEM Middle East is supported by ASPRI (Association of Process Industry) Singapore and GPCA (Gulf Petrochemical & Chemical Association) UAE.