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Tue 4 May 2010 11:24 PM

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Qatar to expand ethane plant, start polyethylene unit

Cracker currently at 64% capacity and isn't expected to reach full output by August.

Qatar to expand ethane plant, start polyethylene unit
CRACKER EXPANSION: Qatar may expand the capacity of its new ethane cracker by 23% as the Gulf state ramps up production. (Getty Images)

Qatar, holder of the world’s third largest natural gas reserves, may expand the capacity of a new ethane cracker by 23 percent as the country ramps up production, the general manager of Qatar Petrochemical Co said.

Output will be raised to 1.6 million metric tons a year at the Ras Laffan Olefins Co cracker that began operation earlier this year producing 1.3 million tons, Mohammed Yousef al Mulla said to Bloomberg News at the inauguration of the plant. The cracker may also be altered to process a mix of gases, he said.

Speaking in Ras Laffan, Qatar, al Mulla said: “We are having a study now. In the future, maybe we will process propane and ethane.”

The cracker, which makes ethylene, is currently running at about 64 percent capacity and isn’t expected to reach full output until August or September when Qatar Chemical Co’s high density polyethylene plant, known as Q Chem II, starts operating, al Mulla said.

Qatar plans to increase its annual petrochemical production to 28 million tons by 2014, utilizing rising natural gas output, Energy Minister Abdullah bin Hamad al Attiyah said today.

Qatar, the world’s biggest producer of liquefied natural gas, plans to pump 23 billion cubic feet of gas a day by 2014.

The Ras Laffan cracker will supply ethylene to both Q Chem II and Qatofin Co’s linear low density polyethylene plant, which started operation last year.

The cracker, which was scheduled to start up last year, was delayed because of “technical issues” that continue to affect the machinery, al Mulla said, without specifying the problems.

He said: “We are having issues and there is already a solution, it will be resolved.”

The ethane cracker and a pipeline that supplies ethylene to the polyethylene plants cost $1.37 billion, al Attiyah said. Polyethylene is used to produce plastics that are used in cars, washing machines and bags.

Ras Laffan Olefins is owned by Qatar Chemical Co, a venture between Qatar Petroleum and Chevron Phillips Chemical Co, and Qatofin, a venture between Total SA and a subsidiary of Industries Qatar.

Ethylene prices in Japan have gained 95 percent in the past year, according to data compiled by Bloomberg.

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