13 March 2012
Muscat: National Mineral Water Co has decided to wind up its subsidiary Polyethylene terephthalate (PET) bottle recycling unit in Fujairah due to regulatory issues.
Horizon Technologies FZE, which was into bottle-to-bottle plastic recycling at Fujairah Free Zone in the United Arab Emirates (UAE), decided to wind up operations due to 'unresolved regulatory constraints imposed by local agencies.'
The shareholders of Horizon Technologies FZE have concluded that under the current conditions, it is not viable to run the operations and decided to wind down the operations.
Horizon's recycling facility was aimed at making full use of the increasing numbers of PET bottles that are being collected in the Middle East and turn them into clean PET flakes that can be sold and reused.
Sources said as a government policy, Fujairah did not give permission for importing used PET bottles for using it as a feedstock in the plant and that was an important reason for winding up operations. The government does not allow used items, as it is considered as a waste material.
When it was commissioned few years ago, the Omani media hailed it as the first major initiative for protecting the environment.
Despite this, the project faced with low level of environmental awareness and logistics challenges. A source said that there was a problem in getting power for the unit.
According to earlier reports, the Horizon plant used to get approximately 600-700 tonnes per month of PET plastic bottles for recycling, which is about 10-12 per cent of UAE's overall consumption.
However, the plant had a capacity to recycle 2,000 tonnes per month. As a result, the capacity utilisation was very low, to make it an economically viable operation.
"Due to winding down the operations, the company has recorded sales turnover of 5,179,013 dirhams for 2011. The net loss for the company for the year is 11,383,723 dirhams, compared to 16,198,862 dirhams in the previous year," National Mineral Water Co said in its directors' report.
Horizon Technologies FZE is a wholly-owned subsidiary of Horizon Technologies SAOC, which is 53.5 per cent-owned by National Mineral Water.
It may be noted that the Gulf region has one of the highest per capita plastic wastage rates in the world.
The United Arab Emirates along with the Kingdom of Saudi Arabia produce the most waste in the region as a result of more disposable income, rising consumerism and the increasing trend of buying bottled water as opposed to drinking tap water.
Shares surge
Meanwhile, shares of National Mineral Water Co further surged ahead by 9.73 per cent to 58 basias amid demand for 39,700 shares on the Muscat Securities Market (MSM), following reports that the United Arab Emirates has banned exports of bottled water produced from ground water.
This will benefit Omani companies, as the exports from UAE will come down.
The company's shares soared 8.16 per cent on Sunday.
The UAE's decision was aimed at promoting water security in the country and the protection of groundwater resources from depletion and its development to ensure sustainability for the current and future generations.
Muscat: National Mineral Water Co has decided to wind up its subsidiary Polyethylene terephthalate (PET) bottle recycling unit in Fujairah due to regulatory issues.
Horizon Technologies FZE, which was into bottle-to-bottle plastic recycling at Fujairah Free Zone in the United Arab Emirates (UAE), decided to wind up operations due to 'unresolved regulatory constraints imposed by local agencies.'
The shareholders of Horizon Technologies FZE have concluded that under the current conditions, it is not viable to run the operations and decided to wind down the operations.
Horizon's recycling facility was aimed at making full use of the increasing numbers of PET bottles that are being collected in the Middle East and turn them into clean PET flakes that can be sold and reused.
Sources said as a government policy, Fujairah did not give permission for importing used PET bottles for using it as a feedstock in the plant and that was an important reason for winding up operations. The government does not allow used items, as it is considered as a waste material.
When it was commissioned few years ago, the Omani media hailed it as the first major initiative for protecting the environment.
Despite this, the project faced with low level of environmental awareness and logistics challenges. A source said that there was a problem in getting power for the unit.
According to earlier reports, the Horizon plant used to get approximately 600-700 tonnes per month of PET plastic bottles for recycling, which is about 10-12 per cent of UAE's overall consumption.
However, the plant had a capacity to recycle 2,000 tonnes per month. As a result, the capacity utilisation was very low, to make it an economically viable operation.
"Due to winding down the operations, the company has recorded sales turnover of 5,179,013 dirhams for 2011. The net loss for the company for the year is 11,383,723 dirhams, compared to 16,198,862 dirhams in the previous year," National Mineral Water Co said in its directors' report.
Horizon Technologies FZE is a wholly-owned subsidiary of Horizon Technologies SAOC, which is 53.5 per cent-owned by National Mineral Water.
It may be noted that the Gulf region has one of the highest per capita plastic wastage rates in the world.
The United Arab Emirates along with the Kingdom of Saudi Arabia produce the most waste in the region as a result of more disposable income, rising consumerism and the increasing trend of buying bottled water as opposed to drinking tap water.
Shares surge
Meanwhile, shares of National Mineral Water Co further surged ahead by 9.73 per cent to 58 basias amid demand for 39,700 shares on the Muscat Securities Market (MSM), following reports that the United Arab Emirates has banned exports of bottled water produced from ground water.
This will benefit Omani companies, as the exports from UAE will come down.
The company's shares soared 8.16 per cent on Sunday.
The UAE's decision was aimed at promoting water security in the country and the protection of groundwater resources from depletion and its development to ensure sustainability for the current and future generations.
© Times of Oman 2012
