Date(s) - 20 February 2010
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Through realizing better than expected financial results, EQUATE Petrochemical Company had risen above the challenging environment endured by the region’s petrochemical industry, said Hamad Al-Terkait, EQUATE’s President & CEO, as well as the Vice Chairman of Gulf Petrochemicals & Chemicals Association (GPCA).
Speaking to Arab Economy magazine on the sidelines of GPCA’s 4th Annual Forum, Al-Terkait said “Despite the decline in demand for petrochemicals products due to the financial crunch, that decreased prices around the world by almost 30%, EQUATE realized better than planned results in 2009.”
Al-Terkait noted “This is mainly due to the company’s proper management of cost relevant to production, maintenance, marketing and logistics, especially during 2009, which has led to achieving a reasonable profit margin in spite of challenges facing the petrochemical sector.”
As financing has become a challenge facing the petrochemical industry after the crisis, Al-Terkait said “Financing is not as easy as before for some industrial entities, whether in term of requisites or cost, this includes many banks within and outside the region, but this doesn’t mean that banks have lost their appetites to fund this industry. Feasible and fruitful investment opportunities are welcomed by banks, not to mention there are finance channels other than banks.” He added that the last loans obtained by EQUATE, valued at USD 2.5 billion from over 50 financial bodies, were before the crunch and payments will start in 2010.
Export operations have kicked off from most EQUATE II during October 2009 after finalizing the expansion relevant to Olefins II with capacities increased by 850,000 metric tons annually (MTA) of Ethylene; 600,000 MTA of Ethylene Glycol; 225,000 MTA of Polyethylene; as well as introducing Styrene Monomer for the first time in Kuwait with a capacity of 450,000 MTA, said Al-Terkait.
The merger between EQUATE and The Kuwait Olefins Company (TKOC) is expected to be done during 2010, said Al-Terkait who noted that the financial crunch has not eliminated joint ventures and mergers in the petrochemical sector within and outside the region, these matters have only become subject to further examination and review.
Marketing operations have become more complicated due to the increase in petrochemical supplies, while the Asian markets have maintained their status as the biggest importers. According to Al-Terkait, EQUATE exports about 60% of its output to those markets, almost 30% to the Middle East and Africa including India and Pakistan, with the rest to Europe.
Considered the final element of the new petrochemical project, commercial operations were started at the Aromatics Complex during December 2009 with production capacities exceeding 820,000 MTA of Paraxylene and over 370,000 MTA of Benzene.
Considered one of the world’s leading companies in producing Polyethylene and Ethylene Glycol, Equate was established in 1995 and it is presently a joint venture between Petrochemical Industries Company (PIC), The Dow Chemical Company (Dow), Boubyan Petrochemical Company (BPC) and Qurain Petrochemical Industries Company (QPIC). It commenced production in 1997 and currently provides markets in the Middle East, Asia, Africa and Europe with high quality petrochemical products.
EQUATE is the single operator of Olefins II, as well as The Kuwait Styrene Company (TKSC) and The Kuwait Paraxylene Production Company (KPPC).
Source: Arab Economy magazine (issue 34)
Date: January 2010
The interview’s original Arabic can be obtained from here:
(Kindly hyperlink the attached PDF to be downloaded through intranet and internet)