Octal Petrochemicals opens Middle East’s largest PET plant
- Integrated PET resin and clear rigid sheet plant built at an initial cost of US$350 million
- World-first technology cuts energy demand by 65 per cent
Oman-based Octal Petrochemicals has started operations of its second PET plant in the southeast port city of Salalah, it was announced today. The new facility has a capacity of 300,000 metric tons per annum, making it the largest PET resin plant of its type in the Middle East and the largest clear rigid PET sheet plant in the world.
As leading clean energy producers gather at the World Future Energy Summit in Abu Dhabi this week, Octal can also point to a major technological breakthrough in the manufacturing processes of its new facility that delivers enhanced energy and cost savings.
Food and consumer packaging markets in the US, Europe and China are Octal’s prime targets in 2009. The first orders of PET resin to Europe have been shipped this month, and Octal expects total per annum sales to reach US$400 million by the end of this year.
Octal Chairman Sheikh Saad Suhail Bahwan said: “The new plant marks the company’s emergence as a global player in PET resin and clear rigid sheet packaging. Our investment delivers dramatically enhanced scale, breakthrough technology, and crucial cost and quality advantages at a time when customers need them most.â€
In just over two years, Octal has become the largest exporter from the port of Salalah and a growing local employer. Octal uses world-first technology to produce clear rigid PET sheet directly from melted PET resin, delivering significant energy savings and enhancements to the quality and clarity of the final product.
Nicholas Barakat, Octal Managing Director, said: “Our patented DPETâ„¢ technology uses a single-phase reactor to integrate PET resin and sheet manufacture. The technology bypasses the expensive PET drying and melting process of conventional clear rigid sheet manufacture, producing PET sheet with superior optical and mechanical properties and using 65 per cent less energy.â€
“The new technology involves enhanced gauge control, creating additional cost savings by achieving higher yields. Our production processes also meet stringent environmental standards – we only use recycled municipal wastewater and PET is 100 per cent recyclable.â€
Octal’s integrated PET resin and clear rigid sheet production plant was built at an initial cost of US$350 million, complementing an existing PET sheet plant opened in Salalah Free Zone in late 2006. Total PET resin capacity is 150,000 metric tons per annum and PET sheet capacity is now 180,000 metric tons per annum.
A second phase of expansion will be completed in early 2011, increasing capacity in PET resin by another 500,000 metric tons. At this stage, Octal will be the largest PET resin company on one site outside China.
Octal employs 250 staff, mostly in Salalah, and plans to hire another 100 this year. Around 30 per cent of employees are Omani nationals.
Barakat said: “Phase one is nearing completion and we remain on track with phase two. Despite the global economic challenges, regional investor interest remains strong and the capital is in place to deliver on our stated growth plans.â€
Octal has placed an initial raw materials order worth US$7 million with Saudi Basic Industries Corporation for PTA, a key chemical used in PET manufacture. Octal’s annual demand for PTA (purified terephthalic acid) is set to exceed US$175 million when the new plant ramps up to full capacity in March 2009.
Other raw materials and equipment orders placed in the region include a contract for mono-ethylene glycol (MEG) worth US$60 million with MEG Global of Kuwait, and steel contracts with a combined value of US$30 million with Mammut Industries of the UAE and Kuwait’s Kirby International.
Worldwide sales of clear rigid PET sheet packaging and PET resins were more than US$2.5 billion and US$15 billion respectively in 2006. The segment is experiencing annual growth of between 7-10 per cent in response to retail demand for clear food and consumer goods packaging at the point of sale and the expansion of supermarket chains in developing countries.
Sheikh Saad Suhail Bahwan said: “We are seeing a backlog of orders in the US and international markets. Our strategy is to focus on the large volume packaging producers who value maximum gloss and clarity in plastic consumer packaging and enhanced durability.
About Octal Petrochemicals
Octal Petrochemicals, a subsidiary of Octal Holding and Co. SAOC (www.octal.com), was established in 2006 and is rapidly becoming the world’s largest producer of amorphous PET sheet and the Middle East’s largest producer of PET resins. With state-of-the-art manufacturing based in the Salalah Free Zone, Oman, Octal has sales and customer support facilities in the United States, Europe and Asia.
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