Kuwait Petrochemicals

According to Marmore’s Kuwait Petrochemical report, increased demand forecasts for paints, electronics and fertilizers in India and China during the period 2015 to 2018 is going to be a key driver for the Petrochemical companies in Kuwait as petrochemicals are the major raw material for the manufacture of paints, electronics and fertilizers.

Chinese self-reliance in the production of petrochemicals is a cause of concern for PIC as China is the major export destination for Kuwait’s petrochemicals. To mitigate the risk, PIC entered into joint venture in China for the construction of the China Integrated plant at Zhanjiang province which is expected to become operational from 2017.

The domestic demand for oil and natural gas is increasing due to increasing population and increased demand for electricity. The shift to heavier feedstock like Naphtha eliminates the cost advantage PIC enjoyed with the subsidized supply of Ethane. Increasing feedstock costs will eliminate the competitive advantage enjoyed by PIC over other petrochemical players outside the GCC region.

PIC has carved out three Horizon plans for the development of the petrochemicals sector in Kuwait. PIC is working towards realizing its Horizon plan –III from the year 2000.

Streamlining investments into refining and petrochemical integration, entering into more number of joint ventures and diversifying the product portfolio with the help of timely government initiatives will help PIC to handle the challenges and achieve its goals set as a part of the Horizon plans.