Page 5 - DMEA Week 10 2021

DMEA COMMENTARY DMEA

outside the Tehran-controlled Strait of Hor- polypropylene and 480,000 tpy of polyethylene.
muz – an allure heightened over the past year by Fellow American company Lummus signed
Iran’s escalating conflict with both Saudi Arabia a deal for technologies for ethylene produc-
and the US. The park will also include a new tion, specifically for NGL extraction, butadi-
export terminal for the sultanate’s own crude – ene extraction and combined methyl tertiary
currently sent via Mina al-Fahal – and berthing butyl ether (MTBE)-1-Butene separation, while
facilities capable of handling ultra large crude Honeywell UOP will provide the technology for
carriers (ULCCs). aromatics.
These awards followed work by UK-based
Petchems problems Wood plc that commenced in mid-2019 for a
While work is proceeding at pace on the refin- steam cracker and units for hydrogen, syngas
ery, initial engineering and design for the 1.6mn and methanol production. Wood’s package also
tonne per year (tpy) integrated ethylene pro- covered the construction of an NGL extraction
cessing cracker was halted in November. While facility in central Oman as well as a 230-km pipe-
the work was anticipated to be completed in Q1 line to carry feedstock to the petchems facility.
ahead of the beginning of construction work,
OQ8 said that its board would assess the impact Financing
of the coronavirus (COVID-19) crisis before The financing of Duqm is the largest project
deciding whether or not to proceed. financing in the sultanate’s history, and financial
Despite putting its petrochemicals plan on close was reached in late 2018.
hold, the company nevertheless issued a provi- The following January, Kuwait’s Supreme
sional contract to Univation Technologies for Petroleum Council (SPC) and Kuwait Petroleum
technologies for a new polyethylene (PE) unit. Corp. (KPC) gave approval for the allocation of
Univation will provide its proprietary UNIPOL $2bn of funds for the refinery.
PE process and associated ACCLAIM high-den- At that point, Duqm Refinery CFO, Mubarak
sity PE catalyst technology for a 480,000 tpy pro- al-Naamany, said in a statement that the debt-eq-
duction train. uity ratio was 55%, implying a total project cost
The train will be able to shift between produc- of around $8.4bn.
tion of high-performance unimodal high-den- Signed up borrowing currently includes
sity PE resins and linear low-density PE, a $1.43bn international commercial facility,
Univation said. Univation disclosed neither the $700mn from UK Export Finance (UKEF),
value of its contract or the timeframe for com- $500mn from Spain’s CESCE and $600mn from
pleting its work. Export-Import Bank of Korea (KEXIM).
Omani Oil Minister Mohammed bin Hamed The international nature of the finance coin-
al-Rumhy previously told Argus Media that con- cides with the nature of the project, which will
struction on the $8bn facility would begin “by focus on export markets as the Sultanate seeks
2022”, with operations expected to commence to maximise the value of crude first through the
on schedule in 2026. It will produce ethylene uti- refinery and then via the petrochemicals facility.
lising LPG, naphtha, NGLs and off-gas streams Given the refinery’s strategic importance to
from the refinery. the country, it appears to have been kept safe
Meanwhile, agreements were signed with from volatility with its future secure, while
several international firms in Q3 for technol- the recent oil price rebound may have Muscat
ogy for the mixed-feed steam cracker, including reconsidering its position on the petrochemical
with US-based LyondellBasell for 280,000 tpy of facility.™

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