Q-Chem, a joint venture of Mesaieed Petrochemical Holding Company (MPHC), is increasing the ethylene production by 7% by 2022 at an estimated cost of QR391mn as part of its five-year master plan involving QR500mn capital expenditure (capex).
“When completed, the sixth furnace expansion project will provide a sustained increase of approximately 7% in ethylene production, increasing the utilisation of Q-Chem’s existing derivatives production capacity,” MPHC board informed the shareholders yesterday at the annual general assembly.
In 2019, Q-Chem shareholders had agreed to support the expansion of the joint venture’s ethylene production facilities in Mesaieed Industrial City. At present, Q-Chem’s normalised ethylene production capacity stand at 1.2mn metric tonnes.
The investment (of QR391mn against earlier estimate of QR364mn) is predicated on positive capital returns and increased operational flexibility.
“There is demand for ethylene globally as well as locally,” Mohamed Jaber al-Sulaiti, manager (Privatised Companies Affairs), Qatar Petroleum, said, reasoning the proposed capacity enhancement.
Earlier addressing the shareholders, MPHC chairman Ahmed Saif al-Sulaiti said the group remained focused on its five-year business strategy of containing expenses, while making investments to unlock new growth potential.
Outlining the strategy for this year, he said MPHC would continue to focus on its five-year plan in order to strengthen its market leadership by increasing sales and improving profitability margins through effective cost optimisation and targeted investments. “Going forward, the group will continue to consider capex investments to enhance capacity, reliability, efficiency and health safety environment performance,” the board said.
The company’s future capex programme in the petrochemical sector also includes dock jetty repair and sulphur silo projects; while in the case of the chlor-alkali segment, capex projects will include caustic storage tank improvements, design improvement to its oxy chlorination grid plates, the installation of a surge arrester on the 33KV QVC network.
“In the long run, these projects will improve production output and reduce emissions at our plants,” the board of directors said.
The Q-Chem facility is an integrated petrochemical plant, producing high-density and medium-density polyethylene, 1-hexene and other products, using technology provided by Chevron Phillips Chemical, a major integrated producer of chemicals and plastics.
MPHC board outlining its future expansion strategy to shareholders yesterday.
