EGYPT - The Refining Business Is Expanding.

The refining business in Egypt is being expanded and modernised, with the private sector involved in new projects. This sector is the biggest on the African continent next to that of South Africa. The government has spent over $3.5 bn since 1982 to upgrade the existing plants in order to raise and improve their product range and to boost efficiency. The focus now is on producing high quality diesel and lead-free gasoline, with Egypt being ahead of neighbouring countries in the drive against pollution.

Egypt has eight refineries with a total capacity of 614,000 b/d. A ninth refinery, Midor, being built near Sidi Kerir and Alexandria, will be on stream in 2001 and will be producing high value fuels. The following are profiles of the existing refineries and new projects in Egypt, and the companies which operate them:

Mostorod Refinery, south of Cairo, has a working capacity of 142,000 b/d and a design capacity of 115,000 b/d. Operated by Cairo Oil Refining Co. (CORC), a unit of state-owned Egyptian General Petroleum Corp. (EGPC), it came on stream in 1973. It produces gasoline, LPG, naphtha, propane and fuel gas. A vapour recovery unit came on stream in 1985 with a capacity to produce 74,000 t/y of LPG, 286,000 t/y of naphtha, 26,000 t/y of propane and 15,000 t/y of fuel gas.

A light naphtha isomerisation unit to produce 330,000 t/y of high octane unleaded gasoline and a hydrotreating unit - both using technology licenced by UOP of the US - have been installed at Mostorod, together with a control system, a power distribution network and a fire protection system. The refinery's general utilities were upgraded as well. These were among EGPC projects scheduled for completion in fiscal year 1999/2000 which began on July 1, 1999. EGPC's engineering unit ENPPI did the work.

Tanta Refinery, north of Cairo, is also operated by Cairo Oil Refining Co. It came on stream in 1969 with a design capacity of 25,000 b/d. After a series of debottlenecking works, with an upgrade completed in early 1997, this plant now has a capacity of 54,000 b/d.

Condensate recovery units at both of CORC's refineries produce about 2 million t/y for the domestic market.

The Mex Refinery, in Alexandria, occasionally exceeds its design capacity of 115,000 b/d. On stream since 1957, it is run by Alexandria Petroleum Co (APC), another EGPC unit. APC has since 1997 formed units in partnership with the private sector, including local banks and insurance companies, to produce a variety of specialty oils at its Mex complex (see below).

Mex was the only refinery in Egypt to operate during the 1967 Arab-Israeli war. A gas recovery unit was installed in 1983 to produce butane. By end-1987 Lummus Crest completed work on revamping the plant's lube oil unit. This raised Mex's capacity by reducing bottlenecks and improving product quality. It could process different grades of crude. A 40,000 t/y hexane resolvent unit was built at Mex in the late 1980s by Kawasaki of Japan. A plant to raise the lube oil capacity from 120,000 t/y to 220,000 t/y was completed in 1995, together a 30,000 t/y lube oil recycling unit using the process of the Dutch KTI Group. A 30,000 t/y re-refining back oil unit was installed in 1996 to produce 20,000 t/y of base stock and neutral oils.

One of APC's JV units at Mex has a continuous catalytic reformer (CCR) and associated isomerisation and hydrotreating units, using UOP process, being installed at Mex so that before end-Feb. 2000 they can turn 13,500 b/d of crude oils and 700,000 t/y of naphtha into 880,000 t/y of high octane unleaded gasoline. The contractor is Technipetrol (Italian unit of French Technip) which got the $168m job in late Feb. 1998.

A vacuum distillation unit, a catalytic middle distillate dewaxing unit, a sour water stripper, an LPG recovery unit and other facilities are being installed at Mex by Tecnicas Reunidas of Spain under a $125m contract signed on June 28, 1998. These will enable Mex to produce 356,000 t/y of high quality gasoil, 93,000 t/y of naphtha and 39,000 t/y of LPG. The Mex complex has a condensate refining unit being installed by Industrialexport of Romania under a $45m contract signed in mid-1998, with UOP having provided the basic designs and Edeleanu of Germany having done the detailed engineering. All these units are to be completed in 2001.

Alexandria Mineral Oils Co. (AMOC), an APC affiliate which is the largest firm of its kind in Egypt producing mineral and hydraulic oils, has a 100,000 t/y plant being built at the Mex complex to produce basic and special oils and 27,000 t/y of wax. These will cover local market needs and reduce imports. The plant should be ready soon.

AMOC has a 110,000 t/y lube oil plant at the Mex complex being built by a French unit of Foster Wheeler under a contract signed in early 1998. Technology is licenced from Texaco. A sub-contracting JV of the local Orascom Construction Industries and IEMSA of Italy are carrying out the civil and mechanical works at the plant's process line under a contract awarded in Sept. 1999. Another JV of local Industrial Construction & Engineering Co. and Italy's Fincimic and Carlo Gavazzi Impianti got a contract for construction work in Oct. 1999. In the same month AMOC signed an MoU with Kuwait-based International Investor and other interests for a JV plant to produce petroleum coke to be built at the Mex complex.

AMOC was set up in 1997, with APC holding 20%. The other shareholders include the National Bank of Egypt, Banque Misr, Banque du Caire, Misr Insurance Co. and El Clark Insurance Co.

Alexandria Special Petroleum Products Co. (ASPPC), another JV affiliate set up by APC in 1998, is having a plant at the Mex complex to produce engine grease, petroleum jelly and bitumens. The main contractor, which bid about $40m for the job in June 1999, is Tecnicas Reunidas of Spain.

APC is the main shareholder in ASPPC, with an equity of 30%. The other partners include local banks and insurance companies, as in the case of AMOC and most of APC's new affiliates.

A petrochemicals affiliate now being formed by APC is proposed to have a plant built at the Mex complex to produce styrenes.

Ameriya refinery, near Alexandria, is run by EGPC unit Ameriya Oil Refining Co. (AORC). It came on stream in Aug. 1972 with a capacity of 50,000 b/d. It had a 1.6m t/y distillation unit and facilities for the manufacture of 750,000 t/y of asphalt, 80,000 t/y of kerosine and 69,000 t/y of lube oils. Since then several units have been added to the plant, increasing its capacity to 75,000 b/d. These include a 1.7m t/y distillation unit using the Technoexport process, a 750,000 t/y vacuum distillation unit, a kerosine desulphuriser, an 80,000 t/y lube oil hydrotreater, a gas oil hydrotreater and a distillate hydrotreater - all using the process developed by IFP. In recent years the capacity of the alkyl-benzene unit was expanded to 50,000 t/y, with the process licenced by UOP. A new 215,000 b/d condensate refining unit was installed at the plant in late 1999 to produce light fuels, with the condensates coming from a 550 MCF/d gas processing plant there. Another project for fiscal 1999/00 at the Ameriya complex is an isomerisation unit to produce high octane unleaded gasoline, as part of government efforts to reduce air pollution in the big urban centres like Cairo and Alexandria. A unit being installed at Ameriya is to improve the quality of gasoil produced from Western Desert crudes.

Ameriya has a 150,000 t/y lube oil blending plant. On stream since Feb. 1996, the plant was built by ENPPI and can produce 135 different types of lubricating oil, with a surplus being exported. The plant receives 80% of its base stocks from local suppliers. The other 20% consists of imported lube oils.

The Ameriya complex's infrastructure includes a 1.5 km, 10-inch pipeline carrying imported lube oils from the port of Alexandria, a storage farm near that of APC's Mex refinery, and two four-inch pipelines carrying base oil feedstocks from the APC Mex complex.

Nasr Refinery at Suez, operated by EGPC unit Nasr Petroleum Co. (NPC), was built by Anglo-Egyptian Oilfields and came on stream in 1913. The oldest refinery in Africa, it now has a capacity of 100,000 b/d. Expensive upgrading units are to be installed at the complex as separate ventures in partnership with the private sector (see below).

The plant was shut down due to damages sustained in the 1967 war. It was reopened partially in Oct. 1974 when a 2,800 b/d unit was resumed. A second unit, 28,000 b/d, came back on stream in Nov. 1974 and gradually the NPC's capacity was restored to 50,000 b/d. In 1990 a new 50,000 b/d distillation unit came on stream, built by EGPC's contracting affiliates Egyptian Engineering for the Petroleum and Process Industries (ENPPI) and Petroject under a $28m deal signed in April 1988. The unit has facilities for vapour recovery, caustic washing of LPG and stabilised naphtha.

Wadi Feiran Refinery, run NPC, is a small topping and reforming plant with a distillation capacity of 10,000 b/d. It is located in the Sinai Peninsula.

Misr Oil Processing Co. (MOPC), set up in early 1998, is one of EGPC's JVs. It was the first to make a public offering (IPO) in Egypt's oil sector on July 5, 1998, when it issued for sale 30% of its capital of about $88m. MOPC now is owned 30% by the public, 20% by EGPC and 10% by NPC. The other 40% are held by National Bank of Egypt, Bank of Alexandria, Banque Misr, Banque du Caire, Nasser Social Bank, Misr Insurance Co., Commercial Int'l Investment Co. and Commercial Int'l Bank.

MOPC is having a hydrocracker under construction at the Suez complex to turn 35,000 b/d of heavy fuel oil surpluses at the various EGPC refineries into high quality diesel, kerosine, jet fuel, butane and light naphtha by early 2001. The main contractor is SnamProgetti which got the $449m job in May 1999, with the engineering and civil works to be done by ENPPI, Daelim of South Korea and Petroject. The project manager is Kvaerner Process of the UK, working with ENPPI. The main licensor is the Lummus Chevron Alliance of the US. Technology for visbreaking, hydrogenation, sulphur recovery and vacuum distillation units are being licenced by IFP of France, Haldor Topsoe of Denmark and Comprimo of the Netherlands. In Sept. 1999 MOPC secured a $550m project financing from local and foreign banks, including MOPC's bank shareholders.

MOPC is to have a CCR built beside the hydrocracker, for which UOP is to provide the licence and basic designs under a contract signed in Oct. 1998. The CCR is to turn 800,000 t/y of surplus naphtha into high octane unleaded gasoline. The $400m project will include facilities for naphtha hydrotreating and isomerisation.

Suez Refinery, the second oldest plant in the country which came on stream in 1921, is run by EGPC unit Suez Petroleum Processing Co. (SPPC). It processes government royalty crudes. Its capacity was increased from 18,000 b/d to 58,000 b/d in 1986 with a 40,000 b/d distillation unit. Improvements to the refinery were made in 1983, when a catalyst-reforming unit came on stream enabling production of higher quality super benzene. Soon afterwards a decoking unit started producing mid-distillates (kerosine & gasoil) for the local market and coke for power stations. Subsequently a 40,000 t/y lube oil recycling plant was built at the plant. Now the refinery's capacity is 68,000 b/d.

The refinery has a small hydrogen unit. Two new boilers of 100 tons each and a water treatment unit have been installed to raise the rate of vapour generation.

Asyut Refinery, in Upper Egypt, is run by EGPC unit Asyut Oil Refining Co. It was built in 1987 by ENPPI and Petrojet at a cost of $350m and has a capacity of 50,000 b/d. For local consumption, it can produce 35,000 t/y of gasoline, 325,000 t/y of kerosine, 325,000 t/y of gas oil, 1.4m t/y of fuel oil and 25,000 t/y of LPG. There have been plans to build a reformer at this plant. Proposals for a 50,000 b/d Asyut-2 plant in the late 1980s to come on stream in 1992 in a $100m project did not materialise.