Qatar Petrochemical Company (Qapco), which suffered a slight dip in its sales turnover in 2001 due to a decline in prices of ethylene and LDPE but nonetheless registered a 17 per cent increase in net profits to QR497 million ($136.5 million), is looking forward to adding polythene to its product range from its joint venture with Atofina.

The new company, Qatofin, will participate in the Ras Laffan Petrochemical project (Q Chem II) by owning interest in the ethylene cracker. The Qatofin project is expected to construct a polythene plant (LLDPE) with an initial capacity of 450,000 tonnes for which the ethylene feedstock will be received from the Ras Laffan cracker to the extent of its share. Qapco has said that any surplus ethylene it receives will be sold to Qatar Vinyl Company (QVC) to meet its expansion requirements. QVC itself is promoted by Qatar Petroleum and Qapco along with foreign partners Norsk Hydro an Atofina.

Qapco is also in the process of undertaking a project to increase its ethylene production capacity to 720,000 tonnes by de-bottlenecking the existing plant on the basis of increased feed gas likely to be available to Qapco on a long-term basis.

Highlights for 2001 at Qapco included production of 535,215 tonnes of ethylene, which was the highest-ever production in the company's history. The ethane-rich gas processed was 716,673 tonnes.

With the record production, Qapco was able to sell 139,358 tonnes, as a result of which the sales revenue increased by 18 per cent to QR189 million. A significant portion of ethylene output is used in the production of various grades of LDPE marketed under the Lotrene brand

The company also recorded its highest production of low-density polyethylene at 382,039 tonnes, higher by 14.6 per cent compared with 2000. The quantity sold was also higher by 14.7 per cent at 375,199 tonnes. But the sales price was lower due to the global economic recession and slowdown. The Middle East and Far East remained the largest buyers. Qapco has a LDPE debottlenecking project as a result of which capacity is expected to increase by 150 tonnes per day.

Production of sulphur was 40,873 tonnes, up 10 per cent. The total quantity sold was 39,045 tonnes with India remaining the sole buyer.

The company's marketing infrastructure now reaches out to more than 4,000 consumers in more than 70 countries.

Qapco, located at the Mesaieed Industrial Area, was established in 1974 as a joint multinational venture to utilise the associated and non-associated ethane gas from petroleum production in line with Qatar's industrialisation plan. Qatar Petroleum is the major shareholder, holding 80 per cent of the total share capital. Atofina of France, a wholly owned subsidiary of Total Fina Elf, holds a 10 per cent stake, while EniChem of Italy holds the remaining 10 per cent. The plant is situated on the seacoast with jetty facilities and exports its entire range of products worldwide. Commercial production began in 1981. Its quality management system was recognised with the ISO 9002 certification in November 1998.

"Investments in the petrochemical sector continue to remain a main area of concentration for the state of Qatar," observed chairman of Qapco and Minister of Energy and Industry Abdullah bin Hamad Al Attiyah. "The petrochemical sector is perceived to be the main channel of expansion for the country's oil- and gas-based industries which could in turn diversify the national income and expand the economic base," said Al Attiyah.

"The plan to form Q Chem II through Qatofin for the construction of a petrochemical complex in Ras Laffan Industrial City and Mesaieed, the commencement of QVC operations, the first downstream petrochemical project in Qatar, and Q Chem I, a project which is in the final stages of construction and is expected to produce HDPE and hexane, are prime examples in this direction.

"The unique geographical location of the country, close to the promising and fast-developing Indian, south-east Asian and Far East markets in addition to the Middle East and European markets, abundant availability of its feedstock at reasonable prices, combined with political and economic stability of the nation, have strengthened the investors' faith in ongoing projects," added Al Attiyah.