May's top stories: Dow’s $3bn project, Saudi Aramco $100bn downstream investment
Saudi Aramco outlined plans to invest more than $100bn in downstream projects and Dow Chemical obtained final approval from US EPA for a $3bn plant in Texas, while a consortium of Toyo Engineering secured a $3bn contract to construct a petrochemical complex in Turkmenistan. Chemicals Technology wraps-up the top stories from May 2014.
Saudi Arabian petroleum and natural gas firm Saudi Aramco said its downstream investments are expected to exceed $100bn in the coming years, citing a surge in demand for oil products.
The announcement was made by Saudi Aramco CEO Khalid al-Falih at the Middle East Petrotech 2014, a Middle East refining and petrochemicals conference and exhibition, held in Bahrain.
Falih said: "Globally, these investments will exceed $100bn over the next decade alone and that is premised on our belief in the long-term sustainability of oil demand."
Dow Chemical received the final greenhouse gas (GHG) prevention of significant deterioration (PSD) construction permit from the US Environmental Protection Agency (EPA) for its $3bn hydrocarbon facility near Freeport, Texas, US.
With this permit, the company can now begin work on the project after 30 days, the EPA said.
During the construction phase, the plant will provide employment for 2,000 people and will create up to 50 permanent jobs upon completion.
A consortium led by Toyo Engineering secured a $3bn contract to construct a petrochemical complex for Turkmengas in Turkmenbashi, western Turkmenistan.
The consortium comprises Hyundai Engineering, Hyundai Engineering & Construction, and LG International of South Korea.
The petrochemical complex, which is planned to be completed in 2018, will source natural gas produced on the Caspian Sea shelf to produce ethylene, high-density polyethylene and polypropylene.
Flint Hills Resources, a subsidiary of Koch Industries, will acquire propylene producer PetroLogistics in an all-cash deal of $2.1bn, including debt.
Propylene is a key petrochemical used in the manufacture of a variety of end products, including paints, coatings, building materials, clothing, automotive parts and packaging.
PetroLogistics operates only one propane dehydrogenation facility in the US, which has an annual production capacity of approximately 1.45 billion pounds.
Israel Chemicals (ICL), majority-owned by industrial conglomerate Israel Corp, dropped its plans to invest $1bn in Israel.
The move comes following recommendations by the governmental Sheshinski Committee to impose a new 42% 'windfall tax' on companies that exploit the country's natural resources.
In a statement, ICL said: "The interim recommendations of the Sheshinski Committee are an economic and social mistake that practically force ICL to go back on most of its investments in Israel, focus on optimisation and cost-cutting, and drive ICL out of Israel."
German chemical firm BASF unveiled plans to increase its investments in research and development (R&D) this year and expects to carry out 50% of its research activities outside Europe by 2020.
In 2013, the company invested €1.8bn on research, compared with €1.7bn in 2012.
BASF member of the board of executive directors and research executive director Andreas Kreimeyer said: "In absolute terms, we lead the field in the chemical industry with our R&D expenditures."
SABIC collaborated with Korean petrochemical firm SK Global Chemical to establish a polyethylene products joint-venture (JV) in Singapore with an investment of $595m.
The 50/50 JV will provide the partners with access to the polyethylene market, providing premium and high-value polymer products to global customers.
It will use SK Global Chemical's Nexlene metallocene technology to produce a range of high-performance polyethylene products.
The JV will operate a series of manufacturing complexes, which will produce metallocene linear low-density polyethylene, polyolefin plastomers and polyolefin elastomers, and cater to the advanced packaging, automotive, healthcare, footwear and electrical and lighting sectors.
Occidental Chemical (OxyChem) secured a final greenhouse gas (GHG) prevention of significant deterioration (PSD) construction permit from the US Environmental Protection Agency (EPA) to build an ethylene cracker in Ingleside, Texas, US.
The project, being carried out in a 50/50 JV between OxyChem and Mexichem, is expected to support the region with 1,700 construction jobs and 150 permanent jobs.
The complex will feature cracking furnaces equipped with selective catalytic reduction technology and produce approximately 1.2 billion pounds of ethylene each year.
AkzoNobel and Belgian chemical company Solvay partnered with Ernst & Young to develop a tool to track the use of renewable raw materials in paints and coatings.
Under the deal, the parties will design a 'chain of custody methodology' to ensure that volumes are assigned and reported even where there is no physical segregation of petro- and bio-based materials.
AkzoNobel innovation and partnerships director Peter Nieuwenhuizen said: "This is a vital next step to measure and share with partners our progress in using Solvay's bio-based epichlorohydrin."