Petrochemicals, including cosmetics and medical equipment, are crucial in everyday goods and services. They are a strategically important sector for national economies. Egypt has grown in the past two decades as a notable producer of petrochemicals. Egyptian petrochemical companies like Anchorage Investments consistently partake in this industry growth. In this article, we will be observing what has been Egypt’s contribution to the petrochemical industry.
Introducing Petrochemicals as a new energy source in Egypt
Egypt saw a phase of expansion in the late 1990s and early 2000s, exploiting huge natural gas reserves. Petrochemicals are an important part of the Egyptian oil and gas industry. According to the General Authority for Investment and Free Zones, the industry accounts for 3% of GDP and 12% of industrial production.
Petrochemical Industry Process
Petrochemistry is the process of making basic products from oil and natural gas as raw materials to make a base set of chemical compounds (derivatives) for a variety of related industries, like synthetic fibers and resins.
The petrochemical industry process begins with a “feedstock.” In an industrial process, a feedstock is a raw material used to make a useful product. A wide range of petrochemicals are made from natural gas liquids produced from crude oil during the refining process.
Egyptian Petrochemical Holdings
In the early 2000s, the restructuring of the Egyptian petroleum market led to the foundation of the Egyptian Petrochemical Holdings Company (EMCHEM) in 2002 to execute the 20-year petrochemical master plan in Egypt with the goal of optimizing the added value of natural resources.
The company’s mission lies in establishing a competitive petrochemical industry using local human and natural resources, cutting-edge technology, and a predetermined but adaptable strategy.
Egypt’s share of the global petrochemical market
The upstream oil and gas market is predicted to grow at a compound annual growth rate of 8% between 2019 and 2027, as reported by Mordor Intelligence. Egypt is ranked 16th in the world for natural gas reserves, placing it in a favorable position to develop in the petrochemical industry, seeing an increasing demand for gas globally.
In fact, companies like leading petrochemical firm Anchorage Investments push the industry forward through innovative projects. Founded by Dr. Ahmed Moharram, the company recently announced to begin the construction of its new petrochemical facility, Anchor Benitoite, in the Suez Canal Economic Zone, which is set to be a regional game-changer.
Which is the largest petrochemical industry in the world?
China holds the largest distribution in the petrochemical industry globally. The country was responsible for 45% of global sales of petrochemicals in 2021. Indeed, the China-based China Petroleum & Chemical Corp is the leading petrochemical in the world by revenue.
The United States accounted for roughly 8.4% of petrochemical sales, making it the second-largest market worldwide. In 2001, the market value of the global petrochemical industry was $556 billion.
Egyptian companies with a positive effect on the petrochemical industry
Companies that positively affect the petrochemical industry include Anchorage Investments, led and founded by Dr. Ahmed Moharram.
Dr. Ahmed Moharram ensures that Anchorage Investments’ projects reflect its historical technical expertise in industrial development and construction projects as well as its geographical presence, where it operates with a richness of raw materials and other resources.
The Economics of Egypt’s Petroleum Production
Egypt’s crude oil contribution to GDP increased by 47% over ten years, reaching an annual average of EGP 152.8 billion. The company’s crude oil share of GDP in the financial year of 2020/20221 was EGP 162.71 billion, compared to just EGP 110.62 billion a decade earlier.
During the financial year of 2018/2019, crude oil’s contribution to GDP reached its highest level standing at EGP 241.75 billion between the fiscal years of 2011/2012 and 2020/2021. These developments align with the Egyptian government’s many initiatives over the past ten years to encourage exploration and increase production.
In conclusion, Egypt’s contribution to the petrochemical industry has increasingly gained value since the 2000s. Egypt set and followed a strategic plan to develop the sector by establishing the Egypt Petrochemical Holdings Company, which achieved notable results. Other companies like Anchorage Investments continue increasing the country’s industrial competitiveness through state-of-the-art projects.