KUWAIT - Olefins II.

On May 7, 2003, PIC and Dow confirmed that the $3 bn Olefins II complex will be built at Shuaiba and will be fully integrated into Equate. This venture now is called The Kuwait Olefins Co. (TKOC), owned 47% by PIC, 47% by Dow and 6% by the local private firm Al-Qurain Petrochemical Co. Equate is overseeing the overall development of the Olefins II complex, which is split into four main process packages.

To be on stream in 2007, the TKOC complex will have a nameplate capacity of 850,000 t/y of ethylene out of ethane, 450,000 t/y of PE using Dow's (UCC's) Unipol technology, and 600,000 t/y of ethylene glycol/ethylene oxide (EG/EO) based on UCC's Meteor technology.

Apart from supplying feedstock to the new PE unit, the new ethane cracker will deliver ethylene to a 300,000 t/y ethyl benzene/styrene unit to be built at the complex for PIC and Dow. The benzene will be supplied from a new aromatics complex which PIC and Al-Qurain will have built at Shuaiba.

Bids for the $550-575m engineering, procurement and construction (EPC) contract for the Olefins II ethylene plant were made in March 2005 by SK Engineering & Construction of South Korea and Technip of France. Technip is said to be the low bidder. Fluor Corp. of the US is the front-end engineering and design (FEED) contractor and project management consultant (PMC) for Olefins II. Societe Generale (SG) of France is financial adviser for TKOC.

Four prequalified contractors attended in late April a pre-tender meeting for the EO/EG package on the Olefins II complex: Foster Wheeler of the US, Toyo Engineering Corp. of Japan, Tecnicas Reunidas of Spain, and Samsung Engineering Co. of South Korea. They attended the meeting at the Dutch offices of Fluor. The four have until July 8 to bid for the $300-400m EPC contract. It was said in early May that the deadline may be extended to the end of August. Two other prequalified contractors - Tecnimont of Italy and GS Engineering & Construction of South Korea - did not attend.

The EPC contract for Olefins II's 300,000 t/y PE plant will be tendered shortly and bids will be expected in the coming months. Snamprogetti of Italy is the PE technology provider and is also expected to bid for the plant.

In parallel is The Kuwait Styrene Co. (TKSC), owned 57.5% by PIC and 42.5% by Dow. This will have a plant with the capacity to produce 450,000 t/y of styrene. Seven international contractors have been invited to bid for the $150m EPC job by June 24. The feedstock for this plant will be provided by an aromatics complex which will be operated by PIC.

The IPO in Al-Qurain in late December 2004 was by far the largest in Kuwait's history. Closing 2.4 times oversubscribed, it was one of the most popular. Al-Qurain also has a 20% stake in The Kuwait Aromatics Co. (KARO) in which PIC holds 80%. The KARO complex, to be built at Shuaiba, will be of strategic importance to PIC.

KARO's complex will have a unit to produce 770,000 t/y of paraxylene and a 330,000 t/y benzene plant. Bids for this were opened on April 17, 2005, and it was announced that a partnership of SK and Technimont was the low bidder for the EPC contract, having offered $1,295m. This was about 6% lower than the second lowest offer of $1,381m from Technip. GS Engineering & Construction (formerly known as LG Engineering & Construction) was the only other prequalified contractor to bid, submitting a price of $1,471m.

State-owned Kuwait National Petroleum Co. (KNPC), KPC's local refining unit, will supply the KARO complex with 2.5m t/y of naphtha feedstock. The plant's technology has been licenced from the UOP of the US. Societe Generale is KARO's financial adviser. Fluor has completed the FEED and is the PMC.

The benzene produced from the aromatics complex will be used as feedstock for the planned styrene unit of TKSC.

The ethane for Olefins II will be supplied from the Mina Al-Ahmadi refining/LPG complex. Hyundai of South Korea last month won the $403m EPC contract, awarded by KNPC, to build a 1,140 MCF/day ethane recovery unit (ERU) at Mina Al-Ahmadi.

The 100,000 t/y polypropylene plant at Shuaiba was completed in September 1997 at a cost of $166m. The EPC contract for it was awarded in February 1995 to Toyo Engineering of Japan. UCC's Unipol is the process for the plant. Providing feedstock for the polyolefins unit of the Equate complex, this is fully owned by PIC.

Toyo's EPC contract included maintenance and the connection of this plant to the Equate complex and to PIC's plants in Shuaiba which are producing fertilisers, salts and chlorine. Apart from feeding Equate's polyolefins unit, the PP is used for the manufacture of furniture, films, toys and electronic and electrical products. A unit at the PP plant producing copolymers out of 6,000 t/y of ethylene is supplied by Equate.

PIC has a new 5,000 ton propylene storage tank and related facilities built at its PP plant.

Gulf PolyTex Co., a private Kuwaiti firm, has an $80m integrated non-woven air-laid composite fabric plant built at Shuaiba and completed in late 2003. Ala' Sa'em Al-Dahr, managing director of ConsulTek Gulf Co. which was the PMC for the venture, has described it as "the first plant of its kind outside the US, Europe and only recently in China".

The plant has a nameplate capacity of 50,000 t/y, which will be expanded later on. It features stand-alone and integrated systems for web forming, binding, finishing, converting and packaging. The composite fabric is exported and supplied to manufacturers of nappies, sanitary towels and wipes, among other products. PP, a primary feedstock for the plant, is supplied by PIC. Other feedstocks are imported. ConsulTek Gulf Co. has done the FEED work, in association with Ramboll of Denmark. The EPC contractor was a partnership of Dan-Webforming of Denmark and Santex of Switzerland.