Packaging producer Octal is implementing productivity improvements to extend capacity at its plant to 1 million tonnes of PET sheet and resins, and further expansions are underway to increase total output capacity to 2.5 million tonnes of polyethylene terephthalate (PET) and purified terephthalic acid (PTA) per year by 2016, a senior official has said.

Currently, production capacity of both PET sheet and resin in Salalah stands at 927,000 tonnes per year. This includes 365,000 tonnes of sheet and 562,000 tonnes of resin.

"We have added two state-of-the-art chemical reactors for resin production, each with capability to produce 720 tonnes per day, to give a total production capacity of 525,600 tonnes per annum. An entire world-scale plant is considered to be 400,000 tonnes, which firmly places Octal’s PET complex amongst the world’s leading plants," said Gary Slawther, Octal’s corporate treasurer.

"We are currently in the process of reviewing technology packages for a backward integration project in the Salalah Free Zone that could add 1.2 million tonnes of PTA capacity. We have room to further expand our PET resin and PET sheet capacity at the same location and that decision will be predicated upon market requirements. We also have a number of downstream projects planned in Saudi Arabia and the USA to drive growth and further expand our capacity."

In 2012 sheet production grew by 38 per cent while resin production increased 12 per cent. Octal is the largest PET producer on a single site.

Only 2 per cent of production is consumed in Oman. The company’s largest markets are the US, EU and the Middle East-Africa region, the latter accounting for nearly 20 per cent of Octal’s sales.

"Our exports have continued to grow – in spite of the economic downturn in the Euro-Zone – and we have also been able to target new markets in South America, West Africa and the former Soviet republics. Octal is truly a global company, accounting for close to 1.5 per cent of the sultanate’s GDP, 10 per cent of Oman’s non-oil exports and generating around $ 180 million worth of income for Omani businesses and SMEs as part of a sustainable and locally-sourced supply chain, Slawther said.

"Large multinational brands like Coca-Cola, Pepsi, Colgate and Unilever have adopted Octal’s unique products for various market applications which have yielded higher volumes. We now supply 100 per cent of Procter & Gamble’s Oral-B dental hygiene products in Europe and have also recently qualified the India and China markets. Backed with the increased capacity, Octal is targeting a 20 per cent increase in our share in markets like the Middle East and North Africa by 2014. Octal’s 1 million tonnes per annum system is expected to generate more than $1.2 billion of yearly sales."

Slawther: eye on downstream projects

Approximately 95 per cent of the company’s PET sheet sales come from its patented DPET products.

According to Slawther, total PET demand is around 18 million tonnes per annum, of which around two million tonnes is sheet. Organic growth is expected to continue increasing total demand to reach 31 million tonnes over the next 10 years. However, further growth is also expected as PET displaces other less environmentally-credible plastics such as PVC and polystyrene. "Octal is leading the global conversion from more traditional packaging materials to PET, supporting manufacturers and testing PET and existing methods side by side to illustrate the advanced capabilities of PET and specifically Octal’s environmentally friendly DPET sheet which is unique in the world," the official stated.

"As the world continues to move towards more sustainable packaging materials, the growth in PET productivity and raw material supplies continue to push prices down. Given the complete recyclability of PET, there is huge potential for PET sheet to become the leading packaging material.

"Furthermore, the accelerated adoption and varied application of Octal’s innovative DPET sheet as a laminated or pre-formed container has showcased the strengths of PET and helped drive the continued expansion of PET in packaging. PET is safe, stable, lightweight and robust. Its versatility and enhanced environmental profile has helped establish it as one of the fastest growing polymers in packaging."