Petrochemical producers in the Gulf are looking for alternative feedstocks due to a shortage of gas, officials said on Tuesday.
Abdulwahab al Sadoun, secretary general of the Gulf Petrochemicals and Chemicals Association (GPCA), said: "There are alternatives; liquified petroleum gas (LPG), condensates."
Speaking at a conference, he said: "Those days of supplying petrochemical complexes with 100 percent ethane are over throughout the region. There are alternatives and those alternatives are explored."
Petrochemical companies in the Gulf Arab region rely heavily on ethane feedstock to expand their production capacity.
In the area, output capacity increased from 4.5 million tonnes in the mid eighties to more than 100 million tonnes currently, Sadoun said.
He added: "The abundant availability of associated gas, ethane rich gas, had resulted in the fact that the ethylene value chain is the most developed in the gulf petrochemical industry."
He said: "71 percent of ethylene (in the region) is produced from cracking ethane, while only 30 percent on a global level is produced from cracking ethane."
GPCA is the regional umbrella organisation of petrochemical and chemical producers in the Gulf.
Saudi Arabia accounts for 50 percent of the region's petrochemicals capacity, Sadoun said.
Saudi Basic Industries Corp (SABIC) alone had 56 million tonnes of petrochemical capacity in 2008 and plans to boost total production to 130 million tonnes by 2020.
At the conference, Saadoun said: "This momentum is likely to continue in the short-term at least with the expansion drive taking place throughout the Gulf countries, adding over 50 million tonnes of new production capacity by 2015."
Saudi Arabia's Tasnee is among other companies in the world's top oil exporter considering the use of heavier feedstock due to restricted gas supplies and to diversify products, Ahmed al Bassam, vice president for business development at Tasnee told Reuters on the sidelines of the conference. (Reuters)
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