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Business

Projects Start in China, Abu Dhabi

Multi-billion-dollar petrochemical investments move forward

by JEAN-FRANÇOIS TREMBLAY AND ALEX TULLO
July 18, 2005 | A version of this story appeared in Volume 83, Issue 29

JOINT EFFORT
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Credit: SAUDI ARAMCO PHOTO BOARD PHOTO
Abdallah S. Jum'ah, president and CEO of Saudi Aramco, speaks at the inauguration of the new joint-venture petrochemical complex in China.
Credit: SAUDI ARAMCO PHOTO BOARD PHOTO
Abdallah S. Jum'ah, president and CEO of Saudi Aramco, speaks at the inauguration of the new joint-venture petrochemical complex in China.

Multinational consortia are forging ahead on two long-studied projects aimed at the burgeoning Asian market.

China Petroleum & Chemical Corp. (Sinopec), Saudi Aramco, and ExxonMobil have begun building their multi-billion-dollar oil refinery and petrochemical complex in Quanzhou, in China's Fujian province. Meanwhile, Borouge--a joint venture between Borealis and Abu Dhabi National Oil Co.--is advancing plans to build another ethylene cracker in Abu Dhabi.

Sinopec will have a 50% stake in the Chinese joint venture, known as the Fujian Refining Ethylene Joint-Venture Project. Aramco and ExxonMobil will each own 25%. The project involves revamping the oil refinery of Sinopec's Fujian Petrochemical subsidiary and tripling its capacity to 240,000 barrels per day. It will also process a cheaper Saudi crude than it previously was able to.

The project will include an 800,000-metric-ton-per-year ethylene cracker, a 1 million-metric-ton aromatics unit, and plants with capacity for 650,000 metric tons of polyethylene and 450,000 metric tons of polypropylene.

The project had been expected to cost $3.5 billion, but an ExxonMobil spokeswoman says the joint venture will recalculate the price because of rising prices for construction materials. The partners expect the project to come on-line in 2008.

On the heels of a deal by Austrian refiner OMV and Abu Dhabi's International Petroleum Investment Co. to purchase the 50% stake in Borealis they didn't already own (C&EN, July 11, page 13), Borealis and Abu Dhabi National Oil are launching a $2.5 billion project.

The unit will consist of an ethylene cracker with 1.4 million metric tons per year of total olefins output, a 540,000-metric-ton polyethylene unit, and two 400,000-metric-ton polypropylene plants.

The project--expected to be completed in 2010 in Ruwais, Abu Dhabi, targets the Asian and Middle Eastern polyolefins market. Foster Wheeler has been awarded the project management contract.

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