CPChem, QatarEnergy take FID, ink contracts for Qatari chemical complex
QatarEnergy and Chevron Phillips Chemical Co. LLC (CPChem)—a 50-50 joint venture of Chevron Corp.’s Chevron USA Inc. and Phillips 66 Co.—have taken positive final investment decision (FID) to proceed with their previously announced plan to jointly build and operate the Ras Laffan petrochemical project (RLPP) in Ras Laffan Industrial City, Qatar, 80 km north of Doha (OGJ Online, June 9, 2022).
As part of the FID signed on Jan. 8, CPChem and QatarEnergy will invest a combined $6 billion for construction of the integrated olefins and polyethylene complex, which will house an ethane cracker equipped to produce 2.08 million tonnes/year (tpy) of ethylene and a two-unit, high-density polyethylene (HDPE) plant with a total production capacity of 1.68 million tpy, the companies said in separate releases.
To operate the complex, the partners have formed Ras Laffan Petrochemicals (RLP), a new joint venture in which QatarEnergy will hold a 70% majority interest and CPChem the remaining 30%.
Upon announcing FID, the JV partners also confirmed awarding engineering, procurement, and construction (EPC) contracts for RLPP’s Packages 1 and 2, covering construction of the complex’s ethylene plant and associated polyethylene plant, respectively.
For Package 1, the Samsung Engineering CTCI joint venture (SCJV)—a consortium of South Korea’s Samsung Engineering Co. Ltd. and CTCI Corp. of Taiwan—will deliver EPC services for RLPP’s main ethane cracker as part a contract initially awarded in late 2022 but not made public until Jan. 8 due to a binding confidentiality agreement, the service providers said in separate releases on Jan. 9.
While Samsung Engineering and CTCI will jointly execute procurement and construction works for the project, Samsung Engineering specifically will deliver engineering of major ethylene production installations including furnaces, ethylene (C2) hydrogenation, a hydrogen purification unit, and three main compressors. CTCI said its scope of delivery will cover engineering of the cracker’s furnaces and utility infrastructure such as steam-condensate collecting, boiler-feed water, among others.
In a Jan. 9 filing to the Korea Exchange, Samsung Engineering valued SCJV’s overall EPC contract for RLPP’s Package 1—which runs from mid-December 2022 through mid-August 2026—at about 3.13 billion won (South Korea), or $2.46 billion, based on an exchange-rate date of Dec. 27, 2022.
Separately, Maire Tecnimont SPA on Jan. 8 said it has been awarded a $1.3-billion lump-sum contract to provide EPC services for RLP’s polyethylene plant, which will consist of two HDPE units equipped with production capacities of 1 million tpy and 680,000 tpy, respectively.
Tecnimont’s scope of work—which also covers the plant’s associated utilities and offsite installations—includes complete engineering services, equipment and material supply, and construction activities, the service provider said.
CPChem—which is also providing project management services for RLPP—confirmed it will license its proprietary MarTech loop slurry process for HDPE production at the complex, details regarding technology licensing for the site’s ethylene production have yet to be disclosed.
The RLP JV additionally said it has let a contract to Emerson Electric Co. to provide main automation works for the planned Ras Laffan complex, but further details on work involved under the contract have not been revealed.
Scheduled for mechanical completion by 2026, RLP’s Ras Laffan petrochemical complex is slated for startup later that year, the RLP JV said.
In 2022, Consolidated Contractors Co. began early site-preparation works for RLP’s grassroots complex on a 435-acre project site in Ras Laffan Industrial City, which—in addition to housing a massive LNG export terminal—serves as an onshore base for the processing of gas and other hydrocarbons produced from Qatar’s offshore North Field (OGJ Online, Sept. 26, 2022).
US project progresses
Announcement of FID on RLP’s Ras Laffan project follows the November 2022 confirmation from QatarEnergy and CPChem that they also are moving forward with construction of a previously delayed grassroots petrochemical complex along the Texas Gulf Coast in Orange, Tex., about 113 miles east of Houston (OGJ Online, Nov. 17, 2022; Aug. 2, 2021).
To be operated by Golden Triangle Polymers Co. LLC—a specially formed JV between CPChem (51%) and QatarEnergy (49%)—the proposed $8.5-billion integrated polymers complex will include a 2.08-million tpy ethylene plant and two 1-million tpy HDPE units for production of proprietary Marlex polyethylene pellets for sale primarily to manufacturers in the Asia Pacific, Europe, and Latin America.
In December 2022, the Golden Triangle Polymers JV let a contract to Technip Energies for delivery of its proprietary modularized cracking furnaces for the planned Texas complex’s main ethane cracker, according to a yearend-2022 release from the service provider.
Technip Energies said its award of the proprietary equipment contract—valued at more than €250 million—follows Golden Triangle Polymers’ earlier selection of the service provider’s proprietary ethylene production technology and process design package for the cracker.
Acting as manager of EPC activities on behalf of the Golden Triangle Polymers JV, CPChem—which also will operate the complex upon planned startup in 2026—previously confirmed awarding the following contracts for the project:
- ZDJV—a joint venture of Zachry Industrial Inc. (Zachry Group) and DL USA Inc.—will deliver EPC on the two HDPE units.
- T.EN Stone & Weber Process Technology Inc. will provide engineering and procurement (EP) for the furnace portion of the ethane cracker.
- PCL Industrial Construction Co. will provide construction-related services for the ethane cracker furnace.
- JKJV—a joint venture of JGC America Inc. and Kiewit Energy Group Inc.—will deliver EPC on additional but unspecified sections of the ethane cracker.
- BMZ Third Coast Partners—a joint venture of Burns & McDonnell Engineering Company Inc. and Zachry Group—will execute works related to utilities and infrastructure at the complex.
- Emerson Process Management LLLP will serve as the project’s main automation contractor.
- W.T. Byler Co. Inc. will manage heavy civil work for the entire site and deliver EPC for the project’s planned rail and storage-in-transit yard.
Both the RLP and Golden Triangle Polymers projects come as part of CPChem and QatarEnergies’ commitments to enabling a reduced-carbon future while meeting increased global demand for polymers, as well as support the next phase of QatarEnergies’ downstream growth strategy, which includes major investments in ethylene, ethylene derivatives, and general polymers, the companies said.
Robert Brelsford | Downstream Editor
Robert Brelsford joined Oil & Gas Journal in October 2013 as downstream technology editor after 8 years as a crude oil price and news reporter on spot crude transactions at the US Gulf Coast, West Coast, Canadian, and Latin American markets. He holds a BA (2000) in English from Rice University and an MS (2003) in education and social policy from Northwestern University.
