The petrochemical industry is a branch of the chemical industry manufacturing organic derivatives used as raw materials, such as refinery products, natural gas, plastic, rubber, and fiber.
Petrochemicals are chemical components derived from petroleum and natural gases. They can be categorized into several derivatives, the most frequently used being ethylene, propylene, and benzene.
The market for this chemical substance plays a crucial role for national economies as they are critical to producing our everyday necessities. They can be found in household items, medical supplies, and more. From cosmetics to solar panels, petrochemicals are challenging to produce without.
With increased energy demand, petrochemical companies continue investing in large projects to supply this demand. Let us look at upcoming petrochemical projects.
What are the upcoming petrochemical projects in Egypt?
Large petrochemical projects are taking on large upcoming projects in Egypt. Let us dive into some of the most noteworthy to come.
- Anchor Benitoite: The Egyptian industrial group, Anchorage Investments is currently developing a petrochemical complex in the Suez Canal, Egypt. The project, named Anchor Benitoite will offer hundreds of new jobs and is set to be composed of several production units to produce a total of 1.75 million tonnes annually of petrochemical products including propylene and crude acrylic acid. In 2022, the company selected Hyundai, and Samsung among its four global companies shortlisted to become the main contractor.
- The Red Sea Refining and Petrochemical Company is pursuing its plans to build a grassroots integrated refining and petrochemicals factory to be located on the Gulf of Suez at the Suez Canal Economic Zone in Ain Sokhna. This petrochemical complex is set to be the largest in Ain Sokhna.
- Another upcoming petrochemical project is the Alamein Petro-Refinery Complex by the Alamein Company. The project hopes to produce 2 million tonnes of petrochemical products and about 535K tonnes of petroleum products annually. The project has an initial investment of $112 million.
How many oil refineries are there in Egypt?
An oil refinery is an industrial plant that converts crude oil into petroleum-based materials, including petrochemicals. Since petrochemicals use crude oil, oil refineries are crucial in production.
According to the Egypt-based oil and gas information provider, Egypt is the biggest oil refiner in Africa having a total of ten refining companies leading 12 refineries. Many of these refineries are run by the state. South Africa holds second place in this rank with six refineries.
Some of these refineries include the Middle East Oil Refinery, the Cairo Oil Refining Company, the Egyptian Refining Company, and the Alexandria Petroleum Company.
What is the future of the petrochemical industry?
Demand for oil products has been witnessing an increase making petrochemicals largely in demand as well. The International Energy Association estimates that petrochemicals will be worth a third of the growth in oil demand in 2023.
In a report by McKinsey, it is predicted that moving ahead into a growing petrochemical demand, companies will be encouraged to adopt a more disciplined approach to capacity additions and work more on core capabilities and strategy by using and applying digital and advanced analytics to reach new productivity levels.
What are the 5 Biggest Petrochemical Companies in the World?
Among the many large petrochemical firms in the world and looking at their revenues in 2021, the 5 biggest companies can be reduced to:
- China Petroleum & Chemical Corporation,
- PetroChina Co Ltd,
- Saudi Arabian Oil Co,
- Exxon Mobil Corporation,
- Shell plc
Egypt’s Petrochemical Industry
The petrochemical market is increasingly gaining importance as more petrochemicals are produced locally. In the fiscal year of 2021/2022, it was reported that 4.3 million tons of petrochemicals were produced compared to 2.1 million tons in the 2015/16 fiscal year. The Egyptian Petrochemicals Holding Company also increased by 85%, reaching more than EGP 3.3 billion.
New investments in the sector and petrochemical projects continue to increase as several local, foreign, and Arab investors trust the industry.
Moreover, these local projects contribute to and promote local petrochemical production to provide quality derivatives and exports.
Is Egypt rich in Petroleum?
In 2016, Egypt was ranked 25th in the world in terms of oil reserves, having held 4.4 billion barrels, accounting for about 0.3% of the world’s total oil reserves. It was recorded that the country consumes about 877K barrels per day of oil and 0.39 gallons per capita every day, with a population of 94 million that year. Additionally, in 2016 Egypt exported 25% of its oil production.
3 Big Egyptian Petrochemical Companies
In the Egyptian petrochemical market, top industry players include:
- Leading Egyptian petrochemical company, Anchorage Investments which uses state-of-the-art technology to operate in the fields of petrochemicals and mining. Their modern business practices allow them to limit their damage to the environment.
- The Egyptian Petrochemicals Holding Company is a state-owned petrochemical firm operating since 2002. Their business activities have included 7 mega chemical projects worth $7 billion in total.
- Operating under the supervision of the Egyptian Ministry of Petroleum and Mineral Resources, the Red Sea National Petrochemicals Company is a governmental entity that operates in line with the country’s government strategy of national economic reform.
In conclusion, the petrochemical market is globally gaining attention with increasing energy demand. Petrochemicals are vital components of modern society’s everyday necessities. Made from crude oil and natural gases, the outcome of petrochemical production is derivatives such as ethylene, propylene, and benzene used to manufacture goods.
The petrochemical market shows prominent prospects, predicted to grow significantly by 2030. With this growth comes the need for petrochemical firms to adapt and enhance their business methods, such as adopting digital and more disciplined business approaches.