Royal Vopak, Saudi Arabia's Zamil Group to Build MENA Bulk Liquid and LNG Terminal Facilities

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Researched by Industrial Info Resources (Sugar Land, Texas)--Zamil Group Holding Company (Al Khobar, Saudi Arabia), a global investment and manufacturing group, and Royal Vopak (Rotterdam, Netherlands), a leading independent tank terminal operator, recently signed a memorandum of understanding to establish a joint venture to develop independent bulk liquid and liquefied natural gas (LNG) terminal facilities across the Middle East and North Africa (MENA) region, catering to oil and chemical majors, natural gas suppliers, and trading companies.

The MENA region, recognized as the global leader in the oil and petrochemical sectors, is expected to witness large-scale production and distribution of value-added products such as intermediate and specialty chemicals, and oil products of high quality. This is expected to augment the region's industrial base. In fact, Zamil recently announced that its joint venture with Chemtura Corporation (OTC:CEMJQ) (Middlebury, Connecticut) is making progress in the development of a world-scale metal alkyls manufacturing complex in Jubail Industrial City, Saudi Arabia. Zamil and Vopak intend to develop bulk liquid storage terminals at strategic locations, and they will be instrumental in providing reliable logistic services to support industrial development in the region. The memorandum of understanding between the two firms represents their growth strategy in a rapidly expanding market.

Saudi Arabia, in particular, is expected to emerge as the global center for petrochemical production, with as many as 30 new plants scheduled for completion in 2010 and another 40 projects in the planning phase. Abu Dhabi, Kuwait, Oman and Qatar also are setting up petrochemical production facilities, with a combined investment of $170 billion envisaged by 2015. The region is set to witness a new wave of investments targeting the production of specialty chemicals and high value-added plastics, which will service industrial clusters developed over the basic building blocks of the chemical industry. Recent market forecasts indicate that the Gulf region would see the production capacity of ethylene being augmented by 19 million tons per year over the next five years. By 2015, the region is likely to account for 33% of the global production of ethylene glycol, 20% of polyethylene, and 13% of higher value-added polypropylene produced worldwide.

Vopak is reportedly the largest operator of independent tank terminals worldwide, currently running 79 terminals with a combined storage capacity of 27.7 million cubic meters across 31 countries. The firm specializes in the storage and handling of oil and chemical products in gaseous and liquid forms.

The Zamil Group has diverse interests in more than 60 sectors, ranging from air conditioning, architectural glass processing, cranes, heavy process equipment, general construction, plastics, paints, chemicals, petrochemicals, steel fabrication, shipbuilding, and port operations and maintenance. The firm employs 12,000 personnel in more than 60 countries.

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