Some resin plant expansion projects in India are moving ahead, though other projects around the world will be delayed by the global recession, according to some industry officials.
ExxonMobil Chemical Co., India's ONGC Petro Addition Ltd. (OPaL) and GAIL (India) Ltd. have pledged their full commitment to continue with their planned investments.
John Verity, polyolefins vice president at Houston-based ExxonMobil, said studies are under way on the company's projects in Qatar, Saudi Arabia and China.
ExxonMobil's expanded joint venture plant in Quanzhou, China, with partners Saudi Aramco Sino Co. Ltd. and China Petroleum and Chemical Corp., is set to start commercial production this year, bringing to market 1.76 billion pounds a year of polyethylene and 880 million pounds of polypropylene.
Verity said planning for such projects take time and they are never timed on market cycles.
New Delhi-based OPaL, which is partially owned by state-owned Oil and Natural Gas Corp. of Dehradun, India, said its PE and PP project in Dahej, India, is progressing well. The $2.5 billion plant is set to start production in December 2012.
GAIL, formerly Gas Authority of India Ltd., is expanding PE capacity from its current 900 million pounds per year up to 1.1 billion pounds in 2010, and 2.2 billion pounds by 2013.
Rajeev Mathur, general manager for marketing, said the natural gas-fed plant will serve the rapidly expanding plastics market in India. GAIL is banking on projected growth in India's per-capita plastics consumption to 16.5 pounds by 2010, up from the current level of 11 pounds.
Still, some officials at PlastIndia, held Feb. 4-9 in New Delhi, warned that some of the resin plant expansions around the world will be canceled or delayed as a result of the global recession. Andrea Borrusa, senior consultant with Zurich, Switzerland-based Access Intelligence International LLC, believes there will be a delay of 18 months to two years on some projects.
At the end of 2008, an estimated 66 billion pounds of capacity expansions had been announced for completion after 2012. Borruso feels only about 33 billion to 44 billion pounds will be completed on time.
He said some of the Middle East projects will be delayed, even though the region has a cost advantage because of its availability of low-cost feedstocks.