Oman Chlorine, the sultanate’s principal supplier of chloralkali products, will for the first time begin production overseas – in Abu Dhabi and Doha.

The two plants will involve a total investment of $140 million equally divided between the two and produce most of the chemicals Oman Chlorine now produces at its plant at Sohar Industrial Estate in Oman’s northern region, the company’s financial controller E Ramakrishnan told Gulf Industry.

Oman Chlorine now produces caustic lye (liquid caustic soda), hydrochloric acid, sodium hypochlorite, caustic flames and calcium chloride. Production of calcium chloride began only in January of this year with the construction of a new plant. The two overseas plants will produce the same range except for calcium chloride.

 However, capacity will be 55 per cent higher than at the Oman plant which has capability to produce 70,000 tonnes annually. “Growing demand for the products locally and in the region is the reason for the proposed investment,” said Ramakrishnan. “Project implementation period is 24 to 28 months and commercial production barring unforeseen circumstances is envisaged by H2 2015.”

Output at the Oman plant in 2011 was 63,923 tonnes against 55,220 tonnes in the previous year. Production in H1 2012 was brisk at 32,120 tonnes. The company realised sales worth RO6.75 million ($17.5 million) last year against RO5.8 million in the previous ear. H1 2012 sales were RO3.61 million.

Half the 2011 sales turnover came from hydrochloric acid with caustic lye and flakes accounting for 35 per cent and sodium hypochlorite 15 per cent.

“Demand for acid is linked to the upstream activities and demand for caustic is linked to basic industrial activity,” said Ramakrishnan.

Last year the company had 37.4 per cent of the sales revenue coming from exports to the UAE and Qatar. As hydrochloric acid is mainly used in oil exploration, its customers are oil field companies with a customer base relatively constant. Customers include Halliburton, Dowell Schlumberger, Occidental Oman, BJ Services, Integrated Petroleum Services and MB Petroleum.

The company’s local and overseas operations helped it realise profits after tax of RO2.65 million in 2011 against RO2.5 million in the previous year.

About the new calcium chloride plant that became operational this year, Ramakrishnan said production would depend on market conditions. “If there is good demand for acid, there will not be any conversion to calcium chloride and if there’s a temporary slump in demand for acid, calcium chloride will be produced. This investment will enable us to operate the plant at optimal level. Currently, the demand for acid is fairly robust.”