Al-Waha Petrochemical Opens 450,000-Ton Polypropylene Plant in Al-Jubail Industrial City

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Researched by Industrial Info Resources (Sugar Land, Texas)--Al-Waha Petrochemical Company (Dubai, United Arab Emirates), a 75:25 joint venture between Sahara Petrochemical Company (SAU:2260) (Riyadh, Saudi Arabia) and LyondellBasell Industries (Rotterdam, Netherlands), has started a new petrochemical complex at the Al-Jubail Industrial City in Saudi Arabia.

The complex includes a propane dehydrogenation (PDH) unit and the world's largest polypropylene plant, based on the LyondellBasell Spherizone process. The plant will produce up to 450,000 tons per year of polypropylene using propane from the PDH. Propane feedstock for the PDH is sourced locally from Dubai's vast natural gas reserves, estimated to be 125 billion cubic meters. The plant, which was built in 35 months, already had been running on a trial basis for several months, but now all performance tests have been completed, and full-scale production is under way.

The polypropylene plant will produce homopolymer, in addition to impact and random copolymer grades of polypropylene, aiming initially to produce tapes used to produce woven fabrics, film and injection-molded products. Al-Waha also intends to produce grades of polypropylene used in fibers and non-woven applications. The Spherizone process also produces resins used in high-grade pipes.

The LyondellBasell Spherizone process involves a multi-zone circulating reactor process and was first commercialized in 2002 at the company's process plant at Brindisi in Italy. Since 2004, the process has been used to produce more than 3 million tons of polypropylene under a licensed basis. LyondellBasell claims that the process is safe, versatile and produces no undesired byproducts, while reducing resource consumption and emissions.

In January 2008, LyondellBasell licensed the Spherizone process to Chinese oil, gas and petrochemical company PetroChina Company Limited (SHA:601857) (Beijing, China) for a 300,000-ton-per-year polypropylene plant to be built at Daqing, in China's Heilongjiang province.

Output from the new complex will be supplied to Saudi Arabia and the Middle East, Europe, Asia and Africa. Al-Waha says that the complex takes advantage of lower costs in the Middle East, while placing the production process close to the markets. The plant will allow Al-Waha to supply locally produced heterophasic and random copolymers to the Middle East for the first time.

Al-Waha signed the financing agreements for the project in 2006, when the project was estimated to cost more than $1 billion, making the complex the largest Islamic financing of a petrochemical project in Saudi Arabia. The complex was constructed by a consortium of Maire Tecnimont SpA (BIT:MT) (Rome, Italy) and Dailim Industrial Company Limited (SEO:000210) (Seoul, South Korea).

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