By Conrad Prabhu -
MUSCAT — Plans for a major Caustic Soda and ethylene dichloride (EDC) complex at Salalah Free Zone (SFZ) are making headway with the promoters set to break ground on the project before the end of this year.
Total investment in the venture, which is being developed by Saltic FZCO (formerly known as Oswal Oman Caustic FZCO), is estimated at between $400- 500 million.
According to officials at Salalah Free Zone, the project has two key components — a 1,000 tonnes per day (tpd) capacity caustic lye plant alongside a 1,231 tpd ethylene dichloride facility. When commissioned by 2014-end, the complex will add to the free zone’s burgeoning petrochemicals cluster which currently includes a huge methanol scheme owned by Salalah Methanol Company and a world-scale PET plant run by OCTAL Petrochemicals.
Several international engineering contractors are currently in the race for a tender to build the complex on an Engineering-Procurement-Construction (EPC) basis. The tendering and evaluation process is being overseen by international consultant WorleyParson’s Mumbai office, it is learnt.
Significant progress has also been achieved on the engineering design of the grassroots venture. Technology for the caustic soda plant will be provided by Chlorine Engineers Corporation of Japan, while Ineos of Europe will provide the know-how for the EDC facility. SNC Lavalin Engineering India and STX Korea have also been involved in the detailed engineering of the project.
Caustic soda has wide application across a number of industries and processes. It is mainly used in the manufacture of pulp and paper, soap and detergents, bleach, and so on, and also finds applications in petroleum processing, metallurgy (alumina) and some chemical processes (synthesis of organic and inorganic compounds). Other applications include water treatment, textiles, and glass making.
On the financial front, BankMuscat, named Financial Adviser in 2009, is expected to prepare an Informational Memorandum for the benefit of potential lenders looking to provide debt finance for the project.
Significantly, Salalah Free Zone has earmarked around 80 hectares of land for the development of the complex against a 25-year lease (with extension options). Salalah Port Services (SPS) is reported to have signed an MoU with Saltic FZCO for access and use of its port facilities.
Likewise, provisional agreements committing up 150 MW of electrical power for the project have been reached, underlining the keen support extended by Dhofar’s authorities towards the early and successful realisation of this important industrial investment.
The project is slated to come on stream in the fourth quarter of 2014, according to Salalah Free Zone officials.
Oman’s petrochemicals industry has attracted billions of dollars in investment over the last four years. While much of this investment is concentrated in the vicinity of maritime gateways at Sohar and Salalah, Sur on the Sharqiyah coast is also home to a large petrochemicals complex. Duqm is also tipped to host a massive petrochemicals hub linked to a giant refinery complex proposed jointly by the government-owned Oman Oil Company and IPIC of the Government of the UAE Emirate of Abu Dhabi.