After over a decade of heavy international sanctions, Iran’s petrochemical industry is trying to recover from its losses and regain its position as an important competitor in the global arena. Iran has an ambitious new plan to heavily invest in the industry and increase production capacity from 64.1m tonnes/year in 2015 to 130m tonnes/year by 2025. The important question is: What are the value-added products that can do most to help the country reach this goal?
In recent years, the 60% share of olefins in the global petrochemical market and their increasing demand, as well as new technologies such as local methane gas-to-olefins/produced methanol-to-olefins (GTO/MTO) and methanol-to-propylene (MTP) which has been more utilised by China and east Asia, have been exciting topics for Iranian policy makers. But is there enough strategic planning to implement this policy?
An important question is: Will the world wait for the Iranian petrochemical industry to increase olefins capacity to supply the increasing demand?
Do the local competitive feedstock costs, based on modern technologies, along with new developments such as the North American shale gas revolution and low oil prices on one hand, and increased local investment in China which has caused lower product prices, on the other, make the current policy feasible?
This article will analyse and evaluate the widespread evolution of olefins projects based on MTO or GTO technologies in the context of future changes in the olefins market.
GLOBAL CHANGES IN OLEFINS
Global ethylene and propylene production has seen an average annual growth rate of 3-4% in recent years – the highest growth after methanol for petrochemical products. By the end of 2014, ethylene and propylene production reached 137m tonnes and 88m tonnes, respectively.
North America, thanks to the shale gas revolution, and China from utilisation of new technologies to produce olefins from coal and methanol, have had the highest level of global olefin production increases. The Middle East and Europe kept their market shares without any significant growth.
Global ethylene demand is expected to grow from 129m tonnes in 2015, to 155m tonnes in 2035. Asia and North America, with 42% and 24% of global demand, respectively, are the largest ethylene consumers in the world. Planned capacities will grow by 1.4%/year in North America and 0.9%/year in Asia in the coming years.
Studies show that growth in demand for olefins is sustained for periods of five years. Hence, it is optimistically expected that ethylene and propylene global demand will reach more than 145m tonnes and 116m tonnes, respectively, by 2020. And propylene production using propane dehydrogenation (PDH) technology is expected to show 45% growth while that by coal-to-propylene (CTP) technology should grow by 25% through 2022…