An estimated $40 billion in new investments is expected in the GCC chemical and petrochemical sector, including non-oil products such as polymer resins and polystyrene, by 2010, a report said.
The Middle East’s chemical and petrochemical sector is on the brink of a new era of investment and expansion, says Abdul Rehman Falaknaz, president of International Expo Consults (IEC), organisers of CHEM Middle East exhibition.
The GCC already produces 30 of the most common intermediate petrochemical products, representing 7 per cent of worldwide production. This is set to increase to 20 per cent of global output by 2010, with Saudi Arabia accounting for almost half of that increase, he said.
The UAE is investing heavily in its petrochemical industry, and will see capacity increase threefold, opening up new opportunities in the downstream and end-use processing sector, said Falaknaz.
“With petrochemical facilities in Europe and the US facing cutbacks due to increasingly high prices and shortage of feedstock, the Gulf countries have emerged as the world's first choice for new facilities and best choice for investment in this industry,” he said.
The decision of where to locate a new complex is an important one for petrochemical companies. The major staging ground in recent years has been the Middle East, and there seems to be valid reason for international companies to locate facilities in this area.
“The continuing expansion and growth in the Middle East has resulted in a need for more sophisticated logistics and supply chain processes to distribute more than 40 million tons of petrochemicals and plastics to over 70 countries on a plant-to-customer basis,” Falaknaz said.
“For the next 10 years at least the Middle East will continue to have an edge over others. Beyond that, new technologies may change the way we produce polymers and petrochemicals. Economics will ultimately decide the future,” he added.
CHEM Middle East exhibition takes place from May 18-20 at Dubai World Trade Centre. The international trade event for the chemical, petrochemical and chemical process industries will feature leading international companies and associations from over 20 markets, including China, Korea and Germany. - TradeArabia News Service