Orlen to scale up Plock petrochemical expansion project
Orlen SA (formerly Polski Koncern Naftowy SA, or PKN Orlen) is expanding the scope of its proposed Olefins 3 complex to be built as part of the operator’s Petrochemicals Development Programme (PDP) at its existing 16.3-million tonne/year (tpy) dual refining and petrochemical manufacturing site in Plock, Poland (OGJ Online, Aug. 9, 2021).
The scaled-up expansion comes in response to a growing market for high-margin petrochemical products, for which global trends suggest market demand is set to continue dynamically increasing during the next decade as refining of crude into traditional fuels gradually decreases, Orlen said on June 30.
“By 2050, the value of the petrochemicals and base plastics market has the potential to double…[and we] are carefully analyzing these changes and intensifying our actions to secure the largest possible share in the petrochemical business and quickly increase revenue generated by this segment,” said Daniel Obajtek, Orlen’s chief executive officer and president.
The decision to broaden the scope of the Plock olefins expansion project directly results from anticipated future demand growth as well as Orlen’s plan to advance a pillar under its ORLEN 2030 strategy specifically involving maximizing profitability of existing operations to increase overall competitiveness and improve energy efficiency.
“[As part of the expanded project scope, we] will modernize the entire existing infrastructure, making our complex the most advanced and eco-friendly in Europe…[an approach that will] undoubtedly reinforce our position as a regional leader in petrochemical production, bolstering the competitiveness of our group and the Polish economy,” Obajtek said.
Orlen now plans to invest 25 billion zloty ($6.15-billion) for the revised Plock Olefins 3 expansion project, an amount almost on par with the group’s overall profit earnings in 2022, the operator said.
A crucial element of the operator’s energy transition strategy, the petrochemical expansion project—which will enable a 30% reduction in carbon dioxide emissions per tonne of product at the site— previously was estimated at a budget of 13.5 billion zloty (OGJ Online, May 19, 2022).
The expanded work scope under the enhanced project will involve “a thorough modernization” the Plock production plant’s current infrastructure, the company said without disclosing further details.
Alongside producing olefins and serving as a base for unidentified future development projects, the modernized Plock complex also will extend the lifespan of the site’s associated refining installations, for which production of petrochemicals will provide unspecified opportunities in the comping years, according to Orlen.
The operator said it also expects the Plock project to capitalize on synergies from Orlen’s merger with Grupa Lotos completed in August 2022 (OGJ Online, Nov. 30, 2022). Orlen’s 10.5-million tpy refining complex in Gdańsk, Poland—acquired as part of the Lotos merger and now jointly owned with Saudi Aramco (30%)— will supply an undisclosed but sizeable volume of naphtha for Plock’s olefin production, which in turn will be used as feedstock for Orlen’s production of low-density polyethylene (LDPE) following its recent acquisition of about 100,000-tpy LDPE capacity from Basell Orlen Polyolefins Sp. z o. o. (BOP), a 50-50 joint venture of LyondellBasell Industries Holdings BV and Orlen.
Orlen completed its spinoff of BOP’s LDPE business in early 2023, the company said in a Jan. 2 release.
Scheduled for completion in 2027, Orlen said the Olefins 3 expansion project will boost production of base petrochemicals by more than 60% at Plock and more than 30% overall across Orlen, including its operations in the Czech Republic and Lithuania.
Most recently, Orlen let a contract in March 2023 to a consortium of Seen Technologie Sp. z o.o. and Atrem SA to deliver a decarbonated water unit, post-decarbonation sludge separation unit, condensate treatment unit, and demi-water unit as a part of the outside battery limit (OSBL) scope of works for the Plock Olefins 3 expansion project, according to the operator’s website.
Orlen previously confirmed the planned Olefins 3 complex will involve construction of a new 740,000-tpy steam cracker, the upgrade of an existing 300,000-tpy ethylene unit, and the shuttering of Plock’s more than 40-year-old, original 340,000-tpy ethylene unit, as well as include construction of five additional units for production of ethylene oxide, ethylene glycols, pyrolysis gasoline, ethyl tertbutyl ether, and styrene to expand the site’s repertoire of derivates supply to domestic and export markets.
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.
