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Asia to contribute to 55% of global propylene capacity additions by 2026

Oil&Gas Materials 31 October 2018 09:13 (UTC +04:00)
Asia is forecast to be the major contributor to the growth of the global propylene industry between 2017 and 2026, accounting for around 55% of the global planned and announced propylene capacity additions by 2026.
Asia to contribute to 55% of global propylene capacity additions by 2026

Baku, Azerbaijan, Oct.31

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Asia is forecast to be the major contributor to the growth of the global propylene industry between 2017 and 2026, accounting for around 55% of the global planned and announced propylene capacity additions by 2026, according to leading data and analytics company GlobalData.

The company’s report: ‘Q3 2018 Global Propylene Capacity and Capital Expenditure Outlook – Dangote Industries Ltd Drives Global Capacity Additions’ reveals that around 111 planned and announced plants are scheduled to come online, predominantly in Asia and the Middle East, over the next nine years.

Within Asia, China plans to add a total capacity of approximately 11.0 million tons per annum (mtpa) by 2026 with the help of 33 planned and announced propylene plants. Capital expenditure (capex) for these plants totals US$7.33bn over the next nine years. Major capacity additions will be from Oriental Energy Co Ltd.

Dayanand Kharade, Petrochemicals Analyst at GlobalData, explains: “China will expand its propylene capacity at the fastest pace than of any country over the next five years. Despite being the largest producer of propylene, it is unable to meet its own rapidly growing domestic demand, forcing the construction of more capacity.”

GlobalData identifies the Middle East as the second highest in terms of propylene capacity additions. Within the region, Iran has 14 planned and announced propylene plants, with a total capacity of roughly 2.8 mtpa by 2026. Capex for these plants is US$2.71bn.

Kharade adds: “In the Middle East, Iran’s state owned company, The National Petrochemical Company is facilitating investments in petrochemical capacity additions.”

The US plans to spend US$0.90bn on three planned and announced propylene plants, with a capacity of around 1.2 mtpa during the outlook period. Major capacity additions will be from Formosa Plastics Group.

In the Former Soviet Union (FSU), most propylene capacity additions are in Russia, with capacity of approximately 1.6 mtpa by 2026. Capex for these plants totals US$1.66bn during the outlook period. Sibur Holding is the top company accounting for the major capacity additions in Russia.

Brazil and Bolivia together lead in South America with planned and announced capacity additions of around 1.2 mtpa by 2026. Capex for these plants totals US$1.10bn. In Africa, Nigeria plans to spend US$1.64bn to add a capacity of roughly 1.7 mtpa, which is expected to come on-stream by 2026.

In Europe, Belgium plans to spend US$0.71bn on the addition of a capacity of 0.7 mtpa, which is expected to come on-stream by 2026.

Dangote Group, Oriental Energy Co Ltd, and Formosa Plastics Group are the top three companies globally in terms of planned capacity additions over the outlook period.

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