Egypt Hydrocarbons Begins Construction of World-Scale Chemical Complex in Suez Region

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Researched by Industrial Info Resources (Sugar Land, Texas)--Egypt Hydrocarbons Corporation (EHC), an affiliate of Carbon Holdings of Egypt (Cairo), has announced that it has completed arrangements for a $298 million loan facility at a world-scale chemical complex in the Suez region of Egypt.

Now that the financial arrangements are in place, work has started on the construction of the complex at the Ain Sokhna industrial zone, some 40 kilometers south of Suez and 130 kilometers east of Cairo.

The engineering, procurement and construction (EPC) contract has been awarded to Uhde GmbH (Dortmund, Germany), part of ThyssenKrupp AG (ETR:TKA) (Dusseldorf, Germany). Technology licenses for the complex also have been arranged with Uhde.

The complex, which is scheduled to begin operations in 2013, will convert ammonia feedstock to nitric acid at the rate of 925 tons each day. The nitric acid will then be processed further to produce about 1,060 tons per day of low-density ammonium nitrate.

Low-density ammonia nitrate is in increasing demand in the mining industry for the manufacturing of explosives, boosted by the ever-increasing need to sink deeper shafts to reach mining ores.

"This project is a significant step for Carbon Holdings and EHC in our plan to execute three major projects over the next five years," said Basil El-Baz, the chairman and CEO of Carbon Holdings, at the signing ceremony. "As a private company, we have the ability to efficiently evaluate market dynamics and implement projects in a timely manner, and this project is a result of that capability."

In addition to the new chemical complex, Carbon Holdings and EHC are developing a greenfield Olefins project at Ain Sokhna, which will consist of a 2.5 million-ton-per-year naphtha cracker and a 900,000 ton-per-year polyethylene complex. In total, the complex will produce 900,000 tons of ethylene per year, which will be converted to polyethylene, and a total of 400,000 tons per year of propylene.

A further project planned in the Ain Sokhna industrial zone is a methanol ammonia complex. Discussions are under way with potential financial partners, in particular from Japan, with talks expected to be completed by 2012, according to Ibrahim Hamdy, the chief financial officer for EHC.

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