Qatar Petrochemicals Company (Qapco), whose net profits surged 14.2 per cent to QR426 million ($117 million) in 2000 from QR373 million in the previous year, has indicated it is studying the possibility of increasing ethylene production capacity to 720,000 tonnes by debottlenecking the existing plant. The capacity increase is being contemplated on the basis there will be increased feed gas supplies from Qatar Petroleum (QP).

Also on the cards are proposals to increase low density polyethylene (LDPE) capacity at Qapco and ethylene dichloride (EDC) capacity at Qatar Vinyl Company (QVC), whose production facilities are integrated with those of Qapco in the Mesaieed Industrial Area near Doha.

Qapco reported gross sales turnover had increased from QR1.067 billion in 1999 to QR1.082 billion in 2000. The net profit to sales increased from 35 per cent to 39 per cent. During 1990-2000, the company earned a net profit of QR3.497 billion ($958 million) and rewarded its investing partners by distributing about QR2.317 billion ($635 million) as dividend, 60 per cent of the total net profit. Qapco was established in 1974.

Its manufacturing facilities comprise an ethylene plant with an annual capacity of 525,000 tonnes per year (tpy), two LDPE plants (total capacity 360,000tpy) and a sulphur plant (70,000 tpy) along with utilities and other offsite and auxiliary facilities. The capacities of ethylene and LDPE increased to current levels from mid-1996 as a result of an expansion undertaken between 1993 and 1995. The feedstock, ethane gas, is supplied by QP for the production of ethylene, a significant part of which is then used in the production of various LDPE grades marketed under the Lotrene brand name.

Qapco is 80 per cent owned by QP, which was established in 1974 as a wholly owned corporation by Qatar and is responsible for developing and distributing the country's oil and gas reserves and promoting downstream industries in the state.

Other shareholders are Atofina (formerly Elf Atochem) of France and EniChem of Italy, each holding a 10 per cent stake. Atofina, which has interests in chemicals, is a wholly-owned subsidiary of leading oil company TotalFinaElf. EniChem is a petrochemical group controlled by the Italian state-owned entity ENI.

Qapco reported it achieved ethylene production of 406,000 tonnes against designed capacity of 525,000 tpy, attributing the lower production to a general shutdown (GSD) for maintenance during two months. Other statistics at the ethylene plant were: ethane rich gas processed was 618,000 tonnes, stripped associated gas processed 1.041 million tonnes and stream factor recorded 95 per cent (out of GSD).

Ethylene sales totalled 80,000 tonnes in 2000 when the overall price increase was 42 per cent compared with 1999. India and Indonesia were the largest buyers. Also during 2000, the ethane recovery unit's revamping project was successfully completed with feed gas processing capability increasing from 153 tonnes per hour to 200.

The ethylene production was set to increase by about 30,000 tonnes.

Production at the two LDPE lines aggregated 333,000 tonnes against a designed capacity of 360,000 tpy, the lower output being attributed to the GSD for maintenance for two months. LDPE-2 recorded its highest ever production of 18,450 tonnes in July 2000. The overall stream factor was around 91 per cent (out of GSD)

The LDPE plant also benefited from good prices, leading to some 327,000 tonnes being sold. The price realisation was 18 per cent higher than in the previous year with the Middle East and the Far East remaining the largest buyers, region-wise.

The sulphur plant produced 37,000 tonnes while capacity was 70,000 tonnes. India remained the sole buyer.

Qapco reported that performance of its electricity, steam, air, oxygen, seawater and nitrogen units was satisfactory, meeting consumption demand at the main plant with overall reliability. The raw water import was 164,000 cu m and the net electricity exported to the government network was more than 20,000 MWH.

The company said its marketing policies were "aggressive in nature", its strategies had "long-term effects" and prospective markets were "studied and monitored in detail", resulting in "enhanced penetration levels and increasing global recognition for our products."

"The coverage of our marketing infrastructure/agent network extends to more than 4,000 customers in over 70 countries on a regular basis," said Qapco. "The advantage of a unique strategic geographical location in the Middle East gives us easy access to customers worldwide which in turn facilitates faster execution of orders, increased turnover and improved customer satisfaction.

"Utilising the latest information technologies, orders are expedited through our head office and worldwide representative offices. Rapid processing results in the cost-effective despatch of products from plant site to customer destinations via land and sea."

"Qapco's consistent efforts in the past showed the results of its presence in the global scenario. Its business strategy has been in line with the successfully adopted approach of an ideal petrochemical business which in terms of size, technology, product flexibility and process integration matches global standards," said Qapco chairman and Qatari Minister of Energy and Industry Abdullah bin Hamad Al Attiyah. "All these are aimed at delivering high-quality products to its customers at a competitive price with quality service and reliability. Because of this successful approach, Qapco is now able to sustain itself in the present competitive environment."

"The role of Qapco in the context of economic development of the state of Qatar has been significant," said Al Attiyah. "As a matter of fact, the Qapco success story led to further development of other petrochemical industries in the state. Qapco, since its inception, has not only contributed to the national economy, but also created human wealth in the state by developing skills, knowledge and career paths for the Qatari people.

"It continues to fulfil its commitment towards Qatari society, its shareholders and its customers, and, in the process, assuming more and more responsibilities towards them to play an anchor role in the years to come... Qapco now finds itself at a very interesting crossroads, where success will be dictated by its ability to capitalise on future opportunities within the constraints of its resources."

Added Al Attiyah: "With a total quality management approach, proven technological capabilities, stringent quality control, cost effectiveness, marketing capabilities and field-proven quality products coupled with dedicated services from competent manpower, it should not be difficult for it to achieve this mission with ease." The minister said "forward integration" in the petrochemical sector was seen as the main way to expand directly or indirectly Qatar's oil- and gas-based industries with a view to diversifying the national income and expanding the economic base. Projects Qapco has participated in with QP and other shareholders, local and foreign, include Qatar Vinyl Company (QVC) and Qatar Plastic Products Company. The Qapco plant is situated in an industrial area that has other key manufacturing companies producing fertilisers, steel, refined products and natural gas liquids. Situated on the coast with jetty facilities, it exports its entire production worldwide. Its Quality Management System yielded the ISO 9002 certification in November 1998.

Says general manager Hamad Rashid Al Mohannadi: "Quality, safety and the environment continued to remain our prime area of commitment. Our commitment to quality is emphasised by complying with the requirements of ISO9002 and focusing on the adoption of the new Quality Management Approach as required by ISO 9000:2000 quality standards. Al Mohannadi said the LDPE and ethylene plants maintained excellent safety levels. "Our commitment to manage operations with high concern for safety is giving fruitful results, with a tremendous decline in accident rates compared to the past," he observed. According to company records, the cumulative accident-free (safe) days of the LDPE and ethylene plants registered figures of 2,170 and 1,211 respectively. "We consider our environment an irreplaceable treasure and cherish the beauty of our existence. In this regard, we have turned our operational and production systems to the highest standards of environmental friendliness. Presently we are harnessing all our efforts towards achieving the ISO14001 certification on environment management and protection," said Al Mohannadi. The company emphasised that several environment protection projects had been implemented starting with the Environment Monitoring Programme and that sufficient funds had been provided for an advanced laboratory for field sampling and analysis of wastewater effluents and emissions. In September 2000, Qapco joined nine other organisations in implementing the first-ever electronic government project. All immigration requests are now directly wired to the Ministry of Interior, resulting in instant and easy processing of applications. An online portal "My Qapco" has been developed, delivering information and services to the employee specific to his role within the organisation. "In a short period of time, the portal could emerge as the single point to access anything and everything, from e-mail to marketing and production reports to business analysis information for quick decision making and much more," the company said.

"It is possible in the future that portals will provide a serious threat to the traditional desktop. The new portal proposes to change the way we use the computer and the way we work as we can access our business data, our communications, our alerts and even some of our applications through a web browser as the portal forms a window on the information contained in the company's back-end applications." Qapco's development team used Oracle's J Developer and PL SQL cartridges to create a Java Development framework. "Qapco's advanced development work in this connection is already paying off in some business areas. The portal which has yet to be fully rolled across the entire company, is facilitating some of the key information to the employees," the company said.

It said it was now focusing on rolling out a similar "Customer Portal", closely followed by a "Partner Portal" and eventually a "Supplier Portal". "The development team intends to rapidly add further functionality to the portal over the next 12 to 18 months. The portal project, which requires a substantial level of investment, technology and skills, is aimed at enhancing operational efficiencies in Qapco. However, greater benefits will be realised when it rolls out similar services to its customers, agents and suppliers," it said.