CAIRO: Egypt’s national plan to build and develop the petrochemical industry in the country recently registered a hit with the start of a $1 billion investment for two large petrochemical projects, both being funded by the Egyptian private sector and Canada.
The projects will produce a cumulative 1.65 million tons of methanol and polypropylene.
The first project will produce methanol from the Mubarak Complex for Gas and Petrochemicals, with $620 million in investments allocated for this project with a production capacity of 1.3 million tons annually.
The project’s Canadian partner will contribute 60 percent of the financing, while the remaining 40 percent will be distributed between Egyptian Petrochemicals Holding Company (ECHEM) and the private sector, according to oilegypt.com.
They also say that a second project will produce propylene and polypropylene, with production of the latter estimated at 350,000 tons per year. Investments in this project are estimated at $350 million, although they may reach $400 million.
According to Minister of Petroleum Sameh Fahmy, in recent years Egypt has been keen on building and strengthening the petrochemical industry in Egypt, as it is one of the most strategic industries, which other industries rely on for their success. Moreover, with the growth and development witnessed in other industries of late, more efficient, technologically adept petrochemical products are in high demand.
According to a study carried out by an international firm, Egypt needs to develop the petrochemical industry for a number of reasons: to allow Egypt to maximize the added value of the industry in support of the national economy, to aid in supporting the balance of foreign currency payments, to allow the nation to make optimum use of the reserves of national gas, to actualize self-sufficiency in petrochemical products (rather than relying on international imports), to provide raw materials to support other national industries and to provide new direct and indirect job opportunities, a problem still plaguing the country.
In 2001, the minister was quoted by oilegypt.com as saying that Egypt has all the necessary potentialities to put the country on the threshold of having a distinguished petrochemical industry, especially after endorsement of the national plan for such a vital industry.
The plan includes establishing 14 petrochemical complexes over a span of 20 years, including 24 projects and 50 productive units, with investments totaling $10 billion for producing 15 millions tons of petrochemical products annually. These were valued at $7 billion to realize self-sufficiency for the local market, according to oilegypt.com. The plan includes the addition of $4 billion in annual revenues from exports, as well as providing 100,000 direct and indirect job opportunities.