Beirut (APD) - The Egyptian government has decided to speed up the feasibility studies for a $9 billion petrochemical project currently under consideration in northern Egypt, Magdi Raadi, spokesman for the Egyptian council of ministers, said on Tuesday according to a report in the Cairo-based al-Ahram daily.
The mega project in the Kafr El Sheikh district will take from seven to eight years to be completed and it would generate annual sales estimated at $9 billion, Egyptian Prime Minister Ahmad Nazif said on Tuesday during a meeting to discuss the project.
Nazif quoted a study which was prepared by international experts in cooperation with the Egyptian oil ministry. The study indicated that an annual added value of $6 billion would be realized from the expected $9 billion in sales.
This project is expected to produce oil derivatives such as gasoline, kerosene and gas oil in addition to petrochemicals that could be used in industrial manufacturing. These petrochemicals include aniline, resins, plastics, chemical products and industrial fibers.
International economic studies predict growing demand for finished oil products and petrochemical products in the next twenty years and support the feasibility of the project, Raadi said.
As present refining capacities are not able to meet growing demand, the studies found that worldwide up to $500 billion in investments in the petrochemical refining technology are needed until 2030, Raadi added.
"We have listened to a report from the oil minister that showed that petrochemical projects could succeed in Egypt. We could also generate a return from refining our oil imports instead of being satisfied with re-exporting these imports as raw materials," Raadi said.
The Egyptian government has an ambitious plan to expand the petrochemicals industry. The plan aims to tap into the strong points of the country, such as its strategic location on oil supply routes, in addition to growing local production of gas and oil. Other advantages for the country are its closeness to destination markets and its cheap and skilled labor force, al-Ahram wrote. [TS]
By Shikrallah Nakhoul, APD Staff Writer in Beirut
© APD (Arab Press Digest) 2006
