Download - GPCA Facts and Figures 2011

GCC Petrochemicals & Chemicals Industry

Facts & Figures 2011

GPCA at a glance…The Gulf Petrochemicals and Chemicals Association (GPCA) is the first trade association of its kind in the Gulf region. And in six short years it has become the benchmark for the region’s industry as well as its voice to the rest of the world. It has established powerful credentials and gained a tangible credibility and trustworthiness. Its burgeoning membership is eloquent testimony to the positive role it plays in promoting the current priorities and issues prevailing in the petrochemical sector. The eight visionary founding members who launched the concept in 2006 are SABIC and TASNEE from Saudi Arabia, QAPCO and QVC from Qatar, PIC and Equate from Kuwait, Borouge from Abu Dhabi, and GPIC from Bahrain. Since then GPCA’s membership base has been growing at the phenomenal rate of 23% per annum. By the end of 2011, GPCA’s full member companies, the regional producers of petrochemical and chemicals, collectively represented as high as 95% of the total Gulf’s petrochemical output by volume, thus, placing GPCA in the unrivalled position of being the industrial spokesperson on matters of importance.

3.4 GCC Capacity Additions (2010-2011) 3.4.1 Capacity additions: breakdown by country 61 3.4.2 Capacity additions: breakdown by product group 62 3.4.3 Basic petrochemicals capacity growth (2007-2011) 63

4. GCC International Trade (2007-2011) 68 4.1 GCC production and export 70 4.2 GCC export by origin 73 4.3 GCC export by product groups 74 4.4 GCC export by destination 75 4.5 Detailed analysis of GCC exports by destination 76 4.6 GCC international trade surplus: 81

breakdown by destination 4.7 GCC international trade surplus: 82

breakdown by product 4.8 Share of chemicals in the worldwide exports of 83

manufactured goods 4.9 Share of GCC in worldwide chemicals exports 84 4.10. Ranking of GCC countries in worldwide 86

chemicals exports

5. Employment (2010-2011) 87 5.1 Employment in GCC petrochemicals industry:

breakdown by country 5.2 Employment in GCC manufacturing and 89

petrochemicals industry 5.3 Workforce nationalization in GCC petrochemical 90

industry

6. Sales Revenue (2010-2011) 92 6.1 GCC Petrochemicals Industry Sales Revenue 94

by Country 6.2 Share of GCC in Worldwide Chemicals 95

Sales Revenues

7. Acknowledgements 96

Contents1. A Message from the Secretary General 4

2. GCC Macroeconomic Indicators 5 2. 1 Contribution of the petrochemical sector to 6

regional and national GDP 2.2. Share of Petrochemicals in non-oil exports 13

on regional and national levels

3. GCC Petrochemicals Industry Profile 20

3.1 GCC Production Capacity by Product (2007-2011) 3.1.1 GCC Capacity: Breakdown by Product Groups 22 3.1.2 GCC Capacity: Breakdown by Value-chain 24 3.1.3 Basic Petrochemicals 26 3.1.4 Fertilizers 28 3.1.5 Polymers 30 3.1.6 Intermediates 31 3.1.7 Top 10 Products in GCC Petrochemicals 32

Capacity 3.1.8 Share of GCC top 10 Products in the 33

Worldwide Capacity 3.1.9. Global Ranking of GCC top 10 Products 43

3.2 GCC Production Capacity by Country (2007-2011) 3.2.1. GCC Production Capacity 44 3.2.2. Basic Petrochemicals: Breakdown by Country 46 3.2.3 Fertilizers: Breakdown by Country 48 3.2.4 Intermediates: Breakdown by Country 50 3.2.5 Polymers: Breakdown by Country 51

3.3 GCC Capacity Utilization (2010-2011) 3.3.1 Capacity Utilization by Country 52 3.3.2 Capacity Utilization by product group 53 3.3.3 Capacity Utilization by Value-chain 54 3.3.4 Basic Petrochemicals Capacity Utilization by Product 55 3.3.5 Polymers Capacity Utilization by Product 57 3.3.6 Fertilizers Capacity Utilization by Product 58 3.3.7 Worldwide Comparison of the GCC Capacity Utilization 59 3.3.8 Worldwide Comparison of the GCC Ethylene Capacity 60

Utilization

Welcome to GPCA’s first annual “GCC Petrochemicals & Chemicals Industry Facts and Figures” report which focuses on the GCC petrochemicals and chemicals industry’s performance for the calendar year of 2011.

This report provides an analysis of the historical growth and developments in the GCC petrochemicals and chemicals industry over the time span 2007-2011. Its scope covers capacity, production, international trade, sales revenue, employment and workforce nationalization. Further, the report sheds light on the growing global position of the GCC petrochemicals industry reflected by the steadily increasing production capacities and the resulting rising share of the GCC producers in the global petrochemicals trade.

Undoubtedly this report would have not been possible without the continued support from our member companies and stakeholders who made available to GPCA key data and information used to prepare this publication. As an inaugural report, we acknowledge that certain sections require further attention and elaboration. We are committed to actively to further develop both the scope and content of future releases of the report.

Finally, this publication demonstrates our commitment to provide useful reference publications for industry players such as analysts, researchers, policymakers and producers. Looking forward, GPCA plans to continue investing in developing relevant industry content in line with our objective to be the premier provider of industry knowledge and services to our members and stakeholders.

Dr. Abdulwahab Al-SadounSecretary General

A Message from the Secretary General

GCC Macroeconomic Indicators2

6 GCC Petrochemicals & Chemicals Industry Facts & Figures 2011

8.9%contribution of manufacturing

sector to GCC GDP in 2011

17%contribution of petrochemicals to the manufacturing sector’s

share in 2011 GDP

7.5%year-on-year growth of Real

GDP in the GCC in 2011

• GCCeconomiesaredominatedbyoil&gassectorwhichcontributed50.6%totheGCCGDPin2011.Therevenuefromoil&gashasbeenprovidinganenormousboosttotherestoftheeconomy via government spending.

• Withinnon-oilindustry,manufacturingsectorscontributed8.9%totheregionalGDP.GCCmanufacturing sector leverages region’s hydrocarbon reserves through oil refining and petrochemicals which accounted for 2.1% and 1.5% of the 2011 regional GDP respectively.

• Withinthemanufacturingsector,petrochemicalssharegrewrapidlyfrom13.9%in2007to17%in2011asaresultofthenewprojectsbeingbuiltandcommissioned.

Petrochemicals sector contribution to the GDP is growing

2.1 Contribution of the petrochemicals sector to regional and national GDP

20.4% 18.7% 21.3% 22.5% 23.5%

13.9% 17.3% 15.6% 16.5% 17.0%

65.7% 64.0% 63.1% 60.9% 59.5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 2009 2010 2011

Other manufacturing Petrochemicals and chemicals Refining sector

Con

tribu

tion

to M

anuf

actu

ring

(%)

GCC countries: Contribution of sub-sectors to manufacturing GDP (%)

Source: GCC National statistical authorities and GPCA analysis, 2012

50.6%

5.4%

7.1%

4.9% 10%

11.9%

8.9%

1.2%

Crude Petroleum & Natural Gas

Finance, Insurance, Real Estate & Business Services

ConstructionOthers

Wholesale & Retail Trade, Restaurants and Hotels

Agriculture, Forestry & Fishing

Transport, Storage &Communication

Manufacturing

Refining sector 2.1%

Petrochemicals andchemicals 1.5%

Othermanufacturing 5.3%

GCC Countries: Contribution to GDP by main activities (% GDP, 2011)

Source: GCC National statistical authorities and GPCA analysis, October 2012

7Gulf Petrochemicals & Chemicals Association

7.1% year-on-year growth of Real GDP in Saudi Arabia in 2011

5.5%non-oil Real GDP growth in

Saudi Arabia in 2011

11%contribution of petrochemicals sector to manufacturing GDP

in 2011

50.1%

4.3%

5.2% 3.4% 7.5%

17.2%

9.8%

2.5%






Construction

Others



Transport,Storage &Communication

Manufacturing

Saudi Arabia : Contribution to GDP by main activities (% GDP, 2011)

Source: Saudi Arabia Central Department of Statistics and Information and GPCA Analysis, 2012

• SaudiArabiaisthelargesteconomyintheGCCaccountingfor43%oftheGCCGDP.• Thepaceofeconomicexpansionin2011reached7.1%,andthenon-oileconomygrewby8%

-thehighestsince1981.• EconomicdevelopmentofSaudiArabiaismarkedbythemajorroleoil&gassectorisplaying

in generating GDP and financing government expenditure. In order to decrease reliance on oil, the Saudi government focused on economic diversification centered on manufacturing sector which include oil refining and petrochemical production.

• In2011manufacturingGDPaccountedfor9.8%ofSaudiArabia’sGDP.Ofthis9.8%theoilrefiningsectorcontributed34%andthepetrochemicalssectorcontributed11%.

2.1.2 Contribution of the petrochemical sector to regional and national GDP

Petrochemicals accounted for 11% of Saudi Arabia’s manufacturing sector contribution to 2011 GDP

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 2009 2010 2011

Source: Saudi Arabia Central Department of Statistics and Information and GPCA Analysis, 2012


Con

tribu

tion

to M

anuf

actu

ring

(%)

33.7% 31.3% 31.7% 34.0% 34.0%

10.5% 12.0% 10.6% 11.0% 11.0%

55.8% 56.6% 57.7% 55.0% 55.0%

Saudi Arabia: Contribution of sub-sectors to manufacturing GDP (%)


7.4%contribution of

manufacturing sector to GCC GDP in 2011


GDP in the UAE in 2011

18.2%contribution of

petrochemical sector to manufacturing GDP in 2011

Refining sector 0.7%Petrochemicals andchemicals 1.3%


35.5%

9.7%

12.5%

7.4%14.5%

12.2%

7.4%

0.8%



Construction

OthersWholesale & Retail Trade, Restaurants and Hotels



Manufacturing

UAE: Contribution to GDP by main activities (% GDP, 2011)

Source: UAE Statistical Bureau, Abu Dhabi Statistical Department and GPCA Analysis, 2012

• UAEeconomyisthesecondlargestGCCeconomiesaftertheSaudieconomy.Aftertheeconomiccrisis,UAEeconomyisgraduallyrecoveringachieving5.2%growthrateofaRealGDP in 2011.

• UAEeconomymanagedtograduallymoveawayfrombeingoil-basedeconomytodiversifytonon-oilmanufacturingandservicesectors.Non-oilsectoraccountedfor64.5%oftheUAE’sGDPin2011withmanufacturingsectorrepresenting7.4%.

Petrochemicals sector accounted for 18.2% of the manufacturing sector’s contribution to the UAE GDP in 2011



UAE: Contribution of sub-sectors to manufacturing GDP (%)

7.0% 7.2% 8.9% 8.9% 9.5%

11.2% 11.5%17.1% 17.2% 18.2%

81.8% 81.4%74.0% 73.9% 72.3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007 2008 2009 2010 2011

Cont

ribut

ion

to M

anuf

actu

iring

(%

)

Source: UAE Statistical Bureau, Abu Dhabi Statistical Department and GPCA Analysis, 2012



GDP in Qatar in 2011

25.8%contribution of petrochemicals sector to manufacturing GDP

in 2011

10%to Qatar GDP in 2011

Manufacturingcontributed

• Between2004and2011,withthedevelopmentofOil&GasactivitiesinQatar,itsGDPgrewatCAGRof27.5%.In2011aloneQatar’sRealGDPgrewby14.1%year-on-year.Qatarisworld’s largest exporter of liquefied natural gas (LNG) accounting for a quarter of LNG exports worldwide.Expansionintheproductionofgas-relatedproducts,LNGandcondensatescoupledwithincreasesinhydrocarbonpricesresultedin57.7%Oil&GascontributiontotheGDP in 2011.

• BesidesOil&Gassector,Qatar’seconomicgrowthhelpedtomakesignificantinvestmentsindevelopingnon-oilsectorwhichresultedinincreasingeconomicreturnsfrommanufacturingsector,financialservicesandinfrastructuredevelopment.Asaresult,nominalGDPfornon-oilsectorgrewatCAGRof25.7%between2004and2011.Non-oilsectorscontributed42.3%totheGDPofQatarin2011.Manufacturingsectorcontributed10%totheRealGDP.

Petrochemicals accounted for 25.8% of the manufacturing sector’s contribution to Qatar GDP in 2011

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


2007

13.4%

26.3%

60.3%

2008

16.6%

32.6%

50.8%

2009

10.5%

20.6%

69.0%

2010

12.4%

24.4%

63.2%

2011

13.1%

25.8%

61.1%

Cont

ribut

ion

to M

anuf

actu

iring

(%

)

Qatar: Contribution of sub-sectors to manufacturing GDP (%)

Source: Qatar Statistic Authority and GPCA Analysis, 2012





57.7%

3.7%5.5%

3.4%11.6%

8.0%

10%

0.1%Crude Petroleum & Natural Gas


Construction

Source: Qatar Statistic Authority and GPCA Analysis, 2012

Others




Manufacturing

Qatar: Contribution to GDP by main activities (% GDP, 2011)



GDP in Kuwait in 2011

10.6%contribution of petrochemicals to manufacturing GDP in 2011

• Kuwait’srealGDPgrowthin2011isestimatedataround8.2%,supportedbya15%increaseinoilproduction.Growthofnon-oileconomicactivityisestimatedataround4.5%in2011drivenbyhighergovernmentexpenditurewhichhasincreasedbyalmost20%inthe2011-2012fiscalyear.

• OilandGassectorcontinuestoaccountforthemajorityofKuwait’sGDPrepresenting62%ofreal GDP in 2011. Oil prices remained high based on strong demand from emerging economies and tight supply. Aside from contributing to national output, higher oil revenues helped to support government development plans. Among the plan’s goals is diversifying the economy away from hydrocarbons,whichisexpectedtoleadtoahighergrowthofthenon-hydrocarbonsector.

• Manufacturingsectorsaw5.1%growthin2011over2010levels.PetrochemicalscontributiontoKuwait’seconomyisestimatedat0.49%whichrepresents10.6%shareofmanufacturingGDP.

Petrochemicals sector in Kuwait accounted for 10.6% of manufacturing sector’s contribution to the country’s GDP in 2011

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Con

tribu

tion

to M

anuf

actu

ring

(%)

Kuwait: Contribution of sub-sectors to manufacturing GDP (%)

2007

19.3%

6.0%

74.6%

2008

18.9%

7.3%

73.8%

2009

36.0%

12.0%

52.0%

2010

34.1%

11.0%

54.9%

2011

32.7%

10.6%

56.7%

Source: Kuwait Central Statistics Bureau and GPCA Analysis, 2012


62%

1.7%3.7%

5.7%10%

12.1%

4.7%

0.25%


Source: Kuwait Central Statistics Bureau and GPCA Analysis, 2012

Petrochemicals andchemicals 0.49%Othermanufacturing 2.7%



Construction

Others

Wholesale & Retail Trade,Restaurants and Hotels



Manufacturing

Kuwait: Contribution to GDP by main activities (% GDP, 2011)

4.7%of Kuwait’s GDP in 2011

Manufacturingaccounted for



GDP in Oman in 2011

53.2%53.2% contribution of

petrochemicals sector to manufacturing GPD

• TheOmanieconomyhasgrownstronglysince2009drivenbyincreasedgovernmentspendingandhigheroilprices.In2011RealGDPgrewby5.4%,upfrom4%growthin2010and 1.1% in 2009.

• TheOmanigovernmentisplacingagreatemphasistoeconomicdiversificationtoensurealternativesourcesofincome.Overthepastyearnon-oilGDPgrewby6.4%comparedwithoil&gasGDPgrowthof3.8%.

• Manufacturingsectorcontributed10.3%totherealGDPofOmanin2011ofwhichpetrochemicals accounted for 53.2%

Petrochemicals sector accounted for 53.2% of the manufacturing sector’s contribution to Oman’s GDP in 2011


10.3%of Oman’s GDP in 2011


50.9%

4.8%

7.9%

5.3% 7.6%

12.1%

10.3%

1.1%






Construction Others

Wholesale & RetailTrade, Restaurants

and Hotels


Source: Oman National Center for Statistics and Information and GPCA Analysis, 2012


Manufacturing

Oman: Contribution to GDP by main activities (% GDP, 2011)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Source: Oman National Center for Statistics and Information and GPCA Analysis, 2012


Cont

ribut

ion

to M

anuf

actu

iring

(%

)

Oman: Contribution of sub-sectors to manufacturing GDP (%)

2007

7.3%

59.6%

33.0%

2008

4.8%

65.7%

29.5%

2009

6.9%

50.9%

42.2%

2010

7.4%

53.7%

38.9%

2011

7.3%

53.2%

39.4%



GDP in Bahrain in 2011

4.6%contribution of petrochemicals sector to manufacturing GDP

in 2011

16.4%of Bahrain’s GDP in 2011


• RealGDPgrowthinBahrainin2011reached2.1%,downfrom4.1%in2010duetotheweaknesses in the financial and tourism sectors.

• ComparedwithotherGCCstates,theeconomyofBahrainisdiversifiedwithmanufacturingsectoraccountingfor16.4%oftheGDPin2011.OilrefineryandaluminumarethebiggestelementsofmanufacturingoutputinBahrainwithpetrochemicalsrepresenting4.6%ofthemanufacturing GDP.

Petrochemicals sector accounted for 4.6% of the manufacturing sector’s contribution to GDP of Bahrain in 2011


29.2%3.6%

8.1%

6.8%

19.3%16.2%

16.4%

0.4%





Finance, Insurance,Real Estate

& Business Services

Construction

Others

Wholesale &Retail Trade,Restaurants

and Hotels


Transport,Storage &

Communication

Manufacturing

Bahrain: Contribution to GDP by main activities (% GDP, 2011)

Source: Bahrain Central Informatics Organization and GPCA Analysis, 2012

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Con

tribu

tion

to M

anuf

actu

ring

(%)

Bahrain: Contribution to sub-sectors to manufacturing GDP (%)

2007

12.2%

3.8%

84.0%

2008

10.5%

4.1%

85.4%

2009

11.6%

3.9%

84.5%

2010

10.0%

3.2%

86.7%

2011

14.2%

4.6%

81.2%



33%year-on-year growth

of GCC petrochemicals export value

55.8million tons of

petrochemicals were exported from GCC in 2011

• Petrochemicalandrelatedproductsaccountforalmosthalfofnon-oilexportsfromtheGCCinvalue and volume terms. In 2011 total value of chemical and related products exported from theGCCequaledUS$44.7bnwhichis55.8milliontons

• Whileexportvolumegrewbyonly6%,duetotheincreaseinpricesformostofthecommodities including chemicals in 2011, export value from the GCC grew by 33% due to strong petrochemicals prices in 2011.

Petrochemicals and chemicals accounted for 43% of GCC’s non-oil exports in 2011

2.2.1 Share of Petrochemicals in non-oil exports on regional and national levels

Share of petrochemicals and chemicals in non-oil exports in the GCC, US$ bn

Petrochemicals Other non-oil exports

43%US$ 44.7 bn

57%US$ 60.5 bn

41%US$ 33.7 bn

59%US$ 47.8 bn

2010Total: US$ 81.5 bn

2011Total: US$ 105.2 bn

Source: GCC National statistical authorities and GPCA Analysis, 2012

Share of petrochemicals and chemicals in non-oil exports in the GCC, million tons

43%55.8 Million

Tons

57%72.8 Million

Tons

2011Total: 128.6 Million Tons


45%52.6 Million

Tons

55%64.6 Million

Tons


Source: GCC National statistical authorities and GPCA Analysis, 2012

44.7bn worth of petrochemicals were

exported from GCC in 2011

US$


35.2 million tons of chemicals and

related products were exported from Saudi Arabia in 2011

30.7bn worth of chemicals and related

products exports from Saudi Arabia in 2011

US$• ValueofSaudiArabia’spetrochemicalsandchemicalsexportsroseby40%in2011fromayear

earlier driven by higher prices and increasing demand. • SaudiArabiashipped35.2milliontonsofpetrochemicalsandchemicalsin2011whichis6%

higher than in the previous year.

Petrochemicals and chemicals exports accounted for 72% of Saudi Arabia’s non-oil export value in 2011


Share of petrochemicalsand chemicals in non-oil exports in Saudi Arabia, %



2011 Non-Oil Export ValueTotal: US$ 47 bn

72%US$ 35.2 bn

28%US$ 13.5 bn

2011 Non-oil Export VolumeTotal: 48.7 Million Tons

65%US$ 30.7 bn

35%US$ 16.4 bn

Source: Saudi Arabia Central Department of Statistics & Information and GPCA Analysis, 2012

Source: Saudi Arabia Central Department of Statistics & Information and GPCA Analysis, 2012


21%year-on-year growth of UAE

chemicals and related products export value in 2011

• TheroleofpetrochemicalsandchemicalsintheUAEnon-oilexportsismarginalrepresenting9%ofthetotalnonoilexportvaluein2011orUS$2.7bn.Thisis21%increasefrom the year before.

• Intermsofvolume,petrochemicalsandchemicalsaccountedfor7%ofthenon-oilexports.ThemajorityofpetrochemicalsandchemicalsareexportedfromtheEmirateofAbuDhabi.ThepetrochemicalsshareofexportsfromAbuDhabiis24%whichishigherthanthepetrochemicalsshareofexportsforthewholeUAE

Petrochemicals exports accounted for a minor share of UAE’s non-oil exports in 2011

2.2.3 Share of Petrochemicals in non-oil exports on regional and national level

Share of petrochemicals and chemicals in non-oil exports in the UAE, %

Source: UAE Statistical Bureau, 2012

Source: Abu Dhabi Statistical Department, 2012

2011 Non-Oil Export ValueTotal: US$ 31bn

2011 Non-Oil Export VolumeTotal: 24.3 Million Tons

7%1.7 Million

Tons

93%22.5 Million

Tons

9%US$ 2.7 bn

91%US$ 28.3 bn



65%US$ 30.7 bn

Shape of petrochemicals & chemicals in non-oil exports in Abu Dhabi, %

Source: UAE Statistical Bureau, 2012

2011 Non-oil export valueTotal: US$ 3.1 bn

24%US$ 757 mn

76%US$ 2.4 bn



46%increase in petrochemicals

and chemicals export value in 2011

• Totalvalueofnon-oilexportsfromQatarin2011isestimatedatUS$7.9bnoutofwhich69%are petrochemicals and chemicals. Compared with the previous year, petrochemicals exports fromQatargrewby46%invalueterms.

• Non-oilexportvolumein2011was11.5milliontonswhichisanincreaseof14%fromtheyearbefore.Petrochemicalsandchemicalscontributed65%tothevolumeofnon-oilexportsfromQatar in 2011.

Petrochemicals and chemicals exports accounted for 69% of Qatar’s non-oil export value in 2011

Share of petrochemicals and chemicals in non-oil exports in Qatar, %



Source: Qatar Statistical Department and GPCA Analysis, 2012

Source: Qatar Statistical Department and GPCA Analysis, 2012

2011 Non-Oil Export VolumeTotal: 11.5 million tons

2011 Non-Oil Export ValueTotal: US$ 7.9 bn

69%US$ 5.4 bn

31%US$ 2.5 bn

65%7.5 Million Tons

35%4 Million Tons



66%year-on-year increase of petrochemicals and

chemicals export value from Kuwait in 2010

• LatestavailabledataonKuwaitexportshowsthatpetrochemicalsandchemicalsexportsaccountfor48%ofnon-oilexportvaluein2010.Thisisanincreaseof66%from2009data.Volume wise the share of petrochemicals and chemicals exports in 2010 reached 61% or 3.9 milliontons.Comparedtotheexportvolumeinthepreviousyearthisisanincreaseof38%.

Petrochemicals and chemicals exports accounted for 61% of Kuwait’s non-oil export volume in 2010*


Share of petrochemicals and chemicals in non-oil exports in Kuwait, %



Source: Kuwait Customs Authority


48%US$ 3.2 bn

52%US$ 3.5 bn

2010 Non-Oil Export VolumeTotal: 6.5 million tons

61%4 Million Tons

39%2.5 Million Tons

*Note: Latest available statistics for foreign trade in Kuwait is for 2010

Source: Kuwait Customs Authority*Note: Latest available statistics for foreign trade in Kuwait is for 2010


71%year-on-year increase in petrochemicals and

chemicals exports from Oman in 2010

• Omansawthevalueofitsnon-oilexportsrisetoUS$6.4bnin2010whichisanincreaseof32%fromtheyearbefore.Petrochemicalsandchemicalsaccountedfor39%ofnon-oilexportvalueinthesameyearpostinganincreaseof71%from2009level.

Petrochemicals and chemicals exports accounted for 39% of Oman’s non-oil export value*


Share of petrochemicals and chemicals in non-oil exports in Oman, %

Source: Oman National Centre for Statistical Department and information and GPCA Analysis, 2012

* - Note: Latest available statistics for foreign trade in Oman is for 2010

Source: Oman National Centre for Statistical Department and information and GPCA Analysis, 2012

* - Note: Latest available statistics for foreign trade in Oman is for 2010


39%US$ 3.9 bn

61%US$ 2.5 bn

2010 Non-Oil Export VolumeTotal: 24 Million Tons

26%6.2 Million Tons

74%17.8 Million Tons



50%year-on-year increase in

petrochemicals and chemicals export volume in 2011

• TotalvalueofnonoilexportinBahrainreachedUS$6.1bnin2011ofwhich4.1%arepetrochemicals and chemicals exports. Compared to the previous year, the value of petrochemicals exports from Bahrain has increased by 50%.

• Volumewise,non-oilexportsfromBahrainreached13.5milliontonswhichisanincreaseof30%fromtheyearbefore.Petrochemicalsandchemicalscontributed8.6%tonon-oilexportvolume.

Petrochemicals and chemicals exports accounted for 8.6% of Bahrain’s non-oil export volume in 2011


Share of petrochemicals and chemicals in non-oil exports in Bahrain, %

2011 Non-Oil Export VolumeTotal: 13.5 Million Tons

2011 Non-Oil Export ValueTotal: US$ 6.1 bn 4.1%

US$ 0.3 bn

95.9%US$ 5.8 bn





8.6%1.2 Million Tons

91.4%12.3 Million Tons

26%6.2 Million Tons

3

GCC Petrochemicals Industry Profile3GCC Production Capacity by Product (2007-2011)GCC Production Capacity by Country (2007-2011)GCC Capacity Utilization (2010-2011)GCC Capacity Additions (2010-2011)


• In2011,GCCbasicpetrochemicalscapacityreached45.4milliontonsperannumwhichaccountsfor38%ofthetotalcapacityoftheregionalpetrochemicalsindustry.Between2007and 2011 regional capacity to produce basic petrochemicals has been expanding at compound annualgrowthrate(CAGR)of13.4%.

• GCCfertilizercapacityin2011wasestimatedat27.4milliontonsperannum.Thisis51%higherthanin2007.From2007-2011CAGRoffertilizersectorintheregionwas10.8%

• In2011regionalcapacityforproductionofpolymersaccountedfor16.8%or20.4milliontonsperannum.In2011GCCpolymerscapacitygrewby4%,howeverthe2007-2011CAGRforpolymers capacity was 16.5%.

• Chemicalproductsaccountedfor14.3%ofthetotalGCCpetrochemicalscapacityin2011andreached17.2milliontonsperannum.From2007-2011chemicalscapacitygrewatCAGRof9.8%,howevertheyear-on-yeargrowthoftheGCCchemicalscapacityin2011was6%.

• GCCcapacityforproductionofintermediatepetrochemicalsaccountedfor8.2%ofthetotalGCCpetrochemicalscapacity.21%CAGRoftheGCCcapacityforproductionofintermediatesis the highest among other product categories. In 2011 alone, capacity of intermediates rose by 11% over the previous year.

• Specialtiescontinuetoaccountfortheminorshareof0.5%ofthetotalpetrochemicalscapacity.

6.9

0

20

40

60Mill

ion

Tons

80

100

120

140

26.6

18.2

11.111.94.673 76

92

2007

27.3

18.2

11.211.96.9

2008

32.5

19.5

16.2

14.88.3

2009

110

44.3

20.1

19.6

16.38.9

2010

121

45.4

27.4

20.4

17.29.9

2011

Basic Fertilizers Polymer Chemical Intermediate Specialities

GCC Petrochemicals Capacity by Product Group, Million Tons

Source: GPCA Petrochemicals Database, October 2012

CAGR: 13.4%

37.5 %Basic Petrochemicals

account for

of the total GCC petrochemicals capacity

36%year-on-year growth of fertilizers capacity

in 2011

77% of GCC petrochemicals capacity is represented by basic petrochemicals, fertilizers and polymers

3.1.1 GCC Capacity: Breakdown by Product Groups

11%year-on-year growth of intermediates capacity

in 2011


• From2007-2011intermediatesandpolymerssawthehighestCAGRof21.4%and16.5%respectively.

• TheGCCcapacityexpansionindexcovering2007to2011revealsthattheregionalcapacityto produce basic petrochemicals, intermediates and polymer products expanded at stronger rate than the region’s overall petrochemicals index.Capacity expansion index for intermediates reached217pointsin2011-thisishighestamongallproductgroups.2011Polymerscapacityexpansionindexof184isthesecondhighest.ExpansionofbasicpetrochemicalsintheGCCbetween2007and2011broughtitsindexto171points.Althoughitdidimproveto151pointsin2011,fertilizer’scapacityexpansionindexismuchlowerthantheoverallGCCindex.

GCC Petrochemicals Capacity by Product Group, %

2007Total: 73 Million Tons


36.4%

24.9%

15.2%

16.2%

6.2%

1%

Basic Fertilizers Polymer Chemical Intermediate Specialities

37.5%

22.7%

16.8%

14.3%

8.2%

0.5%


GCC Petrochemicals Capacity Growth by Product Groups (CAGR, 2007-2011)


21.4%

Intermediate

16.5%

Polymer

14.3%

Basic

10.8%

Fertilizers

9.8%

Chemical -4.4%Specialities

All products CAGR: 13.4%

0

10

-10

20

30


75%Over

of the GCC petrochemicals capacity in 2011 is attributable

to Ethylene (44%) and Methane products (32%)

• ThemajorityofGCCpetrochemicalscapacityisbasedonMethane(C1)andEthylene(C2).In2011theyaccountedfor76%ofthetotalregionalbasiccapacity.WhileC1andC2capacitiesalready represent a significant share of the regional petrochemicals industry, they continue to grow. In 2011 Methane (C1) capacities grew by 13% over 2010 levels and Ethylene (C2) capacities grew by 9%.

• Propylene(C3)productchainrepresents15%ofthetotalpetrochemicalscapacityintheGCC.ShareofC3productshassignificantlyincreasedoverthepast5yearsfrom10%in2007tothecurrent15%.In2011Propylene(C3)productsgrewbyonly2%,howeverthe2007-2011compoundannualgrowthrate(CAGR)forpropyleneproductsis24.1%whichisthesecondonly to aromatics.

• AromaticscapacityintheGCCgrewatCAGR26%between2007and2011.Thisisthehighest growth if compared with GCC capacity growth of other product chains. In 2011, share ofaromaticsinthetotalGCCpetrochemicalscapacityreached8%upfrom5%in2007.

• Analyzing2011capacityexpansionindexbasedon2007being100,weobservethatAromatics and Propylene (C3) products reach highest levels among other value chains. Aromatics’indexroseto252followedcloselybyPropylene(C3)indexof237points.Capacityexpansion index of these two products is much higher than overall GCC capacity expansion index in 2011 of 166 points. Index related to GCC capacity of Ethylene (C2) products was slightly above the overall index. This trend continued in 2011 when Ethylene (C2) capacity expansionindexgrewto176points.

Since 2007 aromatics and propylene have been rapidly expanding at CAGR 26% and 24% respectively

3.1.2 GCC Capacity: Breakdown by Value-chain

GCC Petrochemicals Capacity by Value Chain, Million Tons

0

20

40

60

80

100

120

140

30.3

30.0

7.44.0

2007

73

30.2

31.4

8.15.0

76

2008

32.5

38.6

13.2

6.2

92

2009

34.2

48.4

17.3

8.7

110

2010

38.7

52.8

17.6

10.1

121

2011

Mill

ions

Ton

s

C1 Methane C2 Ethylene C3 Propylene C4 Butadiene Aromatics


CAGR: 13.4%


30%y-o-y grwoth of GCC

Butadiene produces value chain in 2011

26%Capacity of GCC

Aromatics products value chain grew at CAGR

(2007 - 2011)

GCC Petrochemicals Capacity Growth by Value Chain (CAGR, 2007-2011)


Total products CAGR: 13.4%26.0 %

Aromatics

24.1 %

C3 Propylene

15.2 %

C2 Ethylene

7.1 %

C4 Butadiene

6.3 %

C1 Methane

GCC Petrochemicals Capacity by Value Chain, %

32%

44%

15%

1%8%

2007Total:73 Million Tons

41%

41%

10%2%

6%



C1 Methane C2 Ethylene C3 Propylene C4 Butadiene Aromatics


Ethylene, methanol and propylene

collectively account for

88% of total basic

petrochemicals capacity

• Ethylenecapacityrepresents49%oftheGCCbasicpetrochemicalscapacity.Regionalcompaniescontinuedtoexpandtheirethylenecapacitiesbetween2007and2011atCAGR15%.

• MethanolisthesecondlargestbasicpetrochemicalproducedintheGCCaccountingfor22%of the total basic petrochemicals capacity. No significant capacity additions of Methanol were reportedintheGCCbetween2007and2011resultingatCAGRofonly4%.

• Regionalcapacityofpropylenereached7.7milliontonsperannumin2011accountingfor17%ofbasicpetrochemicals.Between2007and2011GCCpropylenecapacitywasgrowingatCAGRof27%,oneofthehighestamongotherbasicpetrochemicals.

• Theshareofbenzeneintheregionalcapacityofbasicpetrochemicalsin2011remainsmodestat6%.Eventhough,benzenecapacitywasgrowingatCAGRof13%,itsshareremainonparwiththe2007levelwhichwas7%ofthetotal.

• Mixedxylenesrepresent5%oftheregionalcapacityofbasicpetrochemicals.Capacitygrowthoftheseproductsbetween2007and2011stoodat50%whichisthehighestamongotherbasic petrochemicals.

• GCCCapacityofButadieneaccountedfor1%oftotalcapacityofbasicpetrochemicalsin2011.

In 2011, the GCC basic petrochemicals production capacity was 45.4 million tons p.a.

3.1.3 Basic Petrochemicals

GCC Basic Petrochemicals Capacity by Product, Million Tons


0

5

10

15

20

25

30

35

40

45

50

12.4

26.4

8.4

3.01.8

2007

27.2

12.4

8.4

3.52.0

2008

32.6

14.7

8.7

5.3

2.2

2009

44.4

21.6

9.8

7.5

2.9

2010

45.4

22.3

9.9

7.7

2.9

2011

Ethylene Methanol Propylene Benzene Mixed Xylenes Butadiene Toluene

CAGR 15%

Mill

ions

Ton

s


Ethylenerepresents

nearly half of the GCC basic

petrochemicals production

capacity

GCC Petrochemicals Capacity by Product, Share %



47%

32%

11%

7%

2%1%

Ethylene Methanol Propylene Benzene Mixed XylenesButadiene Toluene


49%

22%

17%

6%5%

1%

GCC Basic Petrochemicals Capacity Growth by Product, CAGR (%)


0%

Butadiene

0%

TolueneMixed Xylenes

50%

27%

Propylene

16%

Ethylene

13%

Benzene

4%

Methanol

Basic PetrochemicalsCAGR: 15%

0

20

40

60


GCC Fertilizers capacity by product, Million Tons


10.1 10.1 10.7 11.3 12.7

7.6 7.6 8.3 8.311.40.5 0.5 0.5 0.5

3.4

0

5

10

15

20

25

30

18.2 18.2 19.5 20.1

27.4

2007 2008 2009 2010 2011

Mill

ions

Ton

s

Urea Ammonia Diammonium phosphate (DAP)

CAGR 11%

• CapacityexpansionoffertilizerproductshasrecentlybecomeafocusforGCCstates.Themajorityofnewfertilizerscapacitieswereaddedin2011.In2011regionalfertilizerscapacitygrewby36%y-o-y.

• In2011theureaproductioncapacityofGCCcountriesreached12.7milliontoneswhichrepresents46%ofthetotalfertilizerscapacityintheregion.Withthegradualexpansionofureacapacitiesoverthepastyears,urea’sCAGRof6%islowerthan11%growthrateoffertilizersintotal.

• ShareofAmmoniaintheregionalcapacityoffertilizershasbeensteadyat42%.In2011GCCcountrieswereabletoproduce11.4milliontonesofammonia.

• Productioncapabilitiesofdiammoniumphosphates(DAP)intheregionhavebeenlimiteduntil 2011 when a significant capacity of diammonium phosphates (DAP) was brought on stream.WiththenewcapacityadditionsshareofDAPinthetotalfertilizerscapacityin2011roseto12%.DAP’scapacityexpansionindexreached680pointsin2011–thehighestofallfertilizers.

Ammonia and DAP expansions accounted for the majority of fertilizers capacity additions in 2011

3.1.4 Fertilizers

36%year-on-year increase of GCC

fertilizers capacity in 2011

Urea accounts for

46%of the GCC fertilizers capacity

Share of DAP capacity increased to

12%of the GCC fertilizers capacity


GCC Fertilizers Capacity by Product, Share (%)




55%42%

3%

46%

42%

12%

Urea Ammonia Diammonium phosphate (DAP)

GCC Fertilizers capacity growth by product, CAGR (%)


Fertilizers CAGR: 11%

61 %

11 % 6 %

DiammoniumPhosphate (DAP)

Ammonia Urea


95%of the GCC polymers

capacity in 2011

Polyethylene and Polypropylene represent

Regional polyethylene capacity expanded at CAGR

12.4%

Regional polypropylene capacity expanded at CAGR

24.8%2007 - 2011

• TotalGCCcapacityofpolymersproductionfacilitiesreached20.4milliontonsin2011.• PolyethylenehasthelargestpolymerproductioncapacityintheGCCaccountingfor57%of

the total polymers capacity in 2011. • SecondlargestpolymerproductioncapacityintheGCCispolypropylene(PP)which

represents37%oftheregionalpolymerscapacity.• From2007-2011,theGCC’shavesignificantlyexpandedtheirpolymerproductsportfolio.In

2007productionofpolymerswaslimitedtofourproducts,in2011therearesevenpolymerproducts produced in the GCC. New products include Polycarbonate (PC).

• Whilenewpolymerproductsarebeingaddedtothecurrentproductportfolio,capacitiesofthecurrentproductsarealsoexpanding.In2007-2011regionalpolypropylene(PP)capacityhadthehighestgrowthofCAGR24.8%whiletheCAGRforpolyethylenecapacitywas12.4%.

GCC polymers production is concentrated around polyethylene and polypropylene production however new products are being added

3.1.5 Polymers

GCC Polymers capacity by product, Million Tons


7.4 7.39.9 11.4 11.8

3.1

11.1 11.2

16.2

19.6 20.4

3.4

5.7

7.6 7.6

0

5

10

15

20

25

2007 2008 2009 2010 2011

Mill

ion

Tons

Polyethylene PP PVC PC PS PET EPS

CAGR: 16.5%

GCC Polymers capacity by product, Share (%)


2007Total : 11.1 Million Tons

67%

28%

4%1%


37%

2%2%1%

1%

57%

Polyethylene PP PVC PC PS PET

2007 - 2011


• GCCcapacitytoproduceintermediateproductsin2011reached9.9milliontonsperannum.Since2007GCCcapacityofintermediateproductswasexpandinggraduallywithcapacityadditionstakingplaceeveryyear.Compoundannualgrowthrate(CAGR)ofintermediateproductscapacityexpansionbetween2007and2011is21.4%.

• LargestintermediateproductsproducedintheGCCareethyleneoxide(EO)andstyrenemonomer which account for 69% of the regional capacity of intermediate products. Whiletheyarethelargestintermediateproductsintheregion,therehavebeensignificantcapacityadditionsofethyleneoxide(EO)andstyrenemonomeraswell.From2007-2011Ethyleneoxide(EO)capacityexpandedatCAGR16.2%andstyrenemonomerexpandedatCAGRof22.6%overthesameperiod.

• Alongwiththeincreaseincapacityofindividualproducts,theGCCproductportfolioofintermediateproductshasalsobeenincreasing.Since2007,thenumberofintermediateproducts in the GCC has almost doubled. In 2011 GCC states were able to produce nine intermediate products. New intermediate products which started production between 2007and2011includeBisphenolA(BPA),Cumene,VinylAcetatemonomer(VAM)andPropylene Oxide (PO)

GCC countries expanding and diversifying their intermediate products capacities

3.1.6 Intermediates

69%of the GCC intermediate

products capacity

Ethylene oxide (EO) and Styrene Monomer

represent

GCC capacity of intermediate products expanded at CAGR of

21.4%GCC Intermediates capacity by product, Million Tons


2.4

4.6

6.9

8.38.9

9.9

3.9 4.3 4.3 4.31.1

1.92.3 2.4 2.4

1

0.7

0.70.7 0.7

0.7

0

2

4

6

8

10

2007 2008 2009 2010 2011

Mill

ions

Ton

s

Ethylene oxide (EO) Styrene Monomer Bisphenol A (BPA)VCM Cumene EDCVAM Propylene Oxide (PO) 1-hexene

CAGR 21.4%

GCC Intermediates capacity by product, share2007

Total: 4.6 Million Tons2011

Total: 9.9 Million Tons


67%

52%

24%

14%

9%

Ethylene oxide (EO) Styrene Monomer

Bisphenol A (BPA) VCMCumene EDC

VAM

Propylene Oxide (PO)1-hexene

44%

25%

9%

7%

6%4%

3%2%

2007 - 2011


3.1.7 Top 10 Products in GCC Petrochemicals Capacity

• GCCethylenecapacityislargestamongotherproductsandaccountedfor19%oftheregionalpetrochemicals capacity in 2011. Among the top 10 products, three are basic petrochemicals: ethylene, methanol and propylene. Together they account for 33% of the regional petrochemicals capacity.

• UreaisthesecondlargestproductintheGCCandaccountedfor10%oftheregionalcapacity.Fertilizers(urea,ammoniaandDAP)areamongthetop10productsintheregionaccountingfor 23% of the regional capacity.

• Onlytwopolymerproductsarewithintop10:polyethyleneandpolypropylenewhichaccountfor 10% and 6% respectively of the regional petrochemicals capacity.

• Onlytwoofthechemicalsproductsareinthetop10products:MonoethyleneGlycol(MEG)andMethyltert-butylether(MTBE)accountingfor6%and3%respectivelyoftheGCCtotalpetrochemicals capacity.

• Ofthe10productsDiammoniumphosphate(DAP),Propylene,PolypropyleneandEthylenegrewathigherratebetween2007and2011thanthe13%capacitygrowthoftheGCCpetrochemicalssector.DAP’sCAGRof61%wasthehighestamongallotherproducts.

Top 10 products account for 81% of the GCC petrochemcals capacity

Top 10 Products Based on 2011 Petrochemicals Capacity, Share %


2011Total: 121 Million Tones

China Asia (Without China)Europe North America

GCC South AmericaAfrica The rest of World

19%

11%

10%

9%8%6%

6%

6%

3%3%

19%

Ethylene

Urea

Polyethylene

Ammonia

Methanol

Propylene

Polypropylene (PP)

Monoethylene Glycol (MEG)

Methyl tert-butyl ether (MTBE)

Diammonium phosphate (DAP)

Others

Top 10 Products by Capacity Growth (CAGR 2007-2011)


61.5 %

DAP

27 %

Prop

ylen

e

24.8 %

Poly

prop

ylen

e

15.7 %

Ethy

lene

12.4 %

Poly

ethy

lene

10.6 %

Amm

onia

10.3 %

MEG

5.8 %

Urea

2.1 %

MTB

E

Met

hano

l

4.1 %

All products CAGR: 13.4%

19% of the regional


Ethylene accounts for

11% of the regional


Urea accounts for

10% of the regional


Polyethyleneaccounts for


• GCCshareintheworldwideethylenecapacityrosefrom10%in2007to15%in2011.• GCCstateswererapidlyexpandingtheirethylenecapacitiesbetween2007and2011at

compoundannualgrowthrate(CAGR)of15.7%.AmongotherregionsoftheworldonlyChinawas expanding ethylene capacity at a similar pace.

• GCCisthefourthlargestregionintheworldinethyleneproductionafterNorthAmerica,Asia(excluding China) and Europe.

GCC Ethylene capacity expansion CAGR of 15.7% is the highest in the world

151.5million tons in 2011

Worldwide ethylene capacity reached

4.8%Worldwide ethylene

capacity expanded at CAGR

15.7%GCC ethylene capacity

expanded at CAGR

15%of the worldwide ethylene capacity

GCC accounts for

3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Ethylene)

2007 - 2011

2007 - 2011

Worldwide Ethylene capacity by region, share (%)2007

Total: 125.4 Million Tons 2011

Total: 151.5 million tons

Source: Mitsubishi Chemical Techo-Research Corporation (MCTR) and GPCA database, 2012

67%

27%

23%25%

10%

8%5%

2%

North America Asia (excluding China)

Europe GCC

China South America

Africa The rest of World

23%

22%

22%

15%

12%

5%1%

Worldwide Ethylene capacity growth (CAGR 2007-2011)

Source: Mitsubishi Chemical Techo-Research Corporation (MCTR) and GPCA database

15.7 %

3.8 %

1.5 %0.2 % 0 % 0 %

-0.5 %GCC China Asia(excluding China)

SouthAmerica

Europe

Worldwide Ethylene CAGR: 4.8%

Africa The restof World North

America

14.8 %


3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Urea)

• GCCshareintheworldwideureacapacityhasincreasedfrom6%in2007to7%in2011.• GCCregionwasexpandingitsureacapacitiesbetween2007and2011atcompoundannual

growthrate(CAGR)of6%.ThisisthehighestamongotherregionsandonlySouthAmerica’sproducers were expanding their urea capacities at the similar pace.

• Asia(includingChina)continuestobethelargestureaproducerintheworldaccountingfor59% of the worldwide urea capacity.

GCC Urea capacity expansion with CAGR of 6% is the highest in the world

Worldwide Urea capacity by region, share (%)




37%

24%

15%

8%

6% 4% 4%2%

38%

21%

14%

8%

7%5%

4% 3%

China Asia (excluding China)

Europe North America

GCC South America


Worldwide Urea capacity growth (CAGR 2007-2011)


0%

Europe

0%

NorthAmerica

6%

GCC

5%

SouthAmerica

3%

Africa

2%

China

Worldwide Urea CAGR: 2%

-1%Asia (excluding

China)

2%Worldwide urea

capacity expanded at a CAGR of

2007-2011

7%GCC accounts for

of the worldwide urea capacity

6%GCC urea capacity expanded at CAGR

2007-2011


12%GCC accounts for

of the worldwide polyethylene capacity

• GCCshareoftheworldwidepolyethylenecapacityrosefrom10%in2007to12%in2011.• From2007-2011PolyethylenecapacityintheGCCwasexpandingatcompoundannual

growthrate(CAGR)of12.4%.AmongotherregionsoftheworldonlyChinawasexpandingits polyethylene capacity at a faster pace. China and the GCC led worldwide polyethylene expansionbetween2007and2011.

• Polyethyleneproducersinotherpartsoftheworldwerealsoexpandingtheircapacities.Theirshare in the worldwide polyethylene capacity remains marginal and reached 5% in 2011.

• Asia(includingChina)continuestobethelargestpolyethyleneproducerintheworldaccountingfor34%oftheworldwidepolyethylenecapacity.

GCC Polyethylene capacity expansion CAGR of 12.4% is one of the highest in the world

94.6 million tones

Worldwide polyethylene capacity reached

3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Polyethylene)

Worldwide Polyethylene capacity by region, share (%)2007

Total: 76.8 Million Tones2011



67%

26%

21%25%

10%

10%6%

2%

Europe Asia (excluding China)North America China


22%

20%

20%

14%

12%

6%1%5%

Worldwide Polyethylene capacity growth (CAGR 2007-2011)


Worldwide polyethylene CAGR: 5.4%

14.7 %

China

12.4 %

GCC

4.0 %

Asia (excluding China)

3.3 %

Africa

1.6 %

South America

0.9 %

Europe -0.6 %North America

5.4%Worldwide

polyethylene capacity expanded at CAGR

2007 - 2011

12.4%GCC

polyethylene capacity expanded at CAGR

2007 - 2011


3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Ammonia)

• GCCshareoftheworldwideethylenecapacityrosefrom4%in2007to5%in2011.• WhileGCCstateswereexpandingtheirammoniacapacities,otherregionswerealsoadding

ammoniacapacities.AlthoughGCCammoniacapacitywasgrowingatCAGR11%,itsworldwide share increased only by 1%. Most significant ammonia capacity additions were taking place in Asia (excluding China).

• Asia(includingChina)continuestobethelargestammoniaproducerintheworldaccountingfor54%ofworldwideammoniacapacity(Chinaaccountingfor30%andrestofAsiaaccountingfor24%).

GCC Ammonia capacity expansion with CAGR of 11% is one of the highest in the world

Worldwide Ammonia capacity by region, share (%)


2007Total: 174.1 million tones

2011Total: 212.2 Million Tones



South America GCC


33%

15%25%

10%

6%

4% 4%3%

30%

24%

21%

7%

6%

5% 4%3%

Worldwide Ammonia capacity growth (CAGR 2007-2011)

Source: Mitsubishi Chemical Techo-Research Corporation (MCTR) and GPCA database, 2012V

17 %

11 %

8 %

5 %3 % 3 %

0 % -1 %Asia(excluding

China)

GCC The rest of World

Africa South America

ChinaEurope North

America

Worldwide Ammonia CAGR: 5%

212.2Worldwide ammonia

capacity reached 212.2

million tons in 2011

5%Worldwide ammonia


between 2007 and 2011

11%GCC ammonia capacity

expanded at CAGR

5%GCC accounts for

of the worldwide ammonia capacity

2007 - 2011


12%GCC accounts for

of the worldwide Methonal capacity

• GCCshareintheworldwidemethanolcapacityhasdecreasedfrom17%in2007to12% in 2011.

• MethanolcapacityexpansionintheGCCwaslowerthaninotherpartsoftheworldwhich resulted in the GCC region’s reduced share of worldwide methanol capacity

• Mostofthemethanolcapacityadditionssince2007havebeeninChina.ConsequentlyChina’sshareofworldwidemethanolcapacityrosefrom23%in2007to40%in2011.

• 45%oftheworldwidemethanolcapacityisconcentratedinAsia(includingChina)which makes Asia the largest producer of methanol in the world.

GCC continue to be one of the top methanol producing regions in the world accounting for 12% of worldwide methanol capacity

85 million tons in 2011

Worldwide methanol capacity reached

3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Methanol)

Worldwide Methanol capacity by region, share (%)2007


Total: 85 Million Tons


23%

25%

17%

19%

6%4% 3%3%

40%

16%12%

12%

10%

5%

3%2%



South America GCC


Worldwide Methanol capacity growth (CAGR 2007-2011)

2007-2011


32 %

China

22 %

Asia(excluding China)

15 %

Africa

4 %

GCC

2 %

South America -1 %North

America

2 %

Europe

Worldwide Methanol CAGR: 14%

14%Worldwide methanol


2007-2011

4%GCC methanol capacity

expanded at CAGR

2007-2011


3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Propylene)

• GCCshareintheworldwidepropylenecapacityincreasedfrom3%in2007to7%in2011.• Asia(includingChina)andNorthAmericacontinuetobethelargestpropyleneproducersinthe

worldaccountingfor67%oftheworldwidepropylenecapacity.• GCCstateswererapidlyexpandingtheirpropylenecapacitiesbetween2007and2011at

compoundannualgrowthrate(CAGR)of27%.• Chinaaloneaccountsfor18%oftheworldwidepropylenecapacity.Since2007Chinahas

beenexpandingitspropylenecapacitiesataCAGRof14.2%whichisthesecondhighestgrowth rate after GCC

GCC propylene capacity expansion of CAGR 27% is the highest in the world

Worldwide Propylene capacity by region, share (%)




24%

28%24%

14%

3%

5%

2%

Asia (excluding China) North AmericaEurope China


26%

23%19%

18%

7% 4%

2%1%

Worldwide Propylene capacity growth (CAGR 2007-2011)

Source: Mitsubishi Chemical Techo-Research Corporation (MCTR) and GPCA database, 2012V

27%

GCC

14.2%

China

7.9%


6.7%

Africa

6.0%

SouthAmerica

1.6%

NorthAmerica

-0.3%Europe

Worldwide propylene CAGR 6.4%

112.9Worldwide propylene

capacity reached


6.4%

27%

Worldwide propylene capacity expanded at CAGR

GCC propylene capacity expanded at CAGR

7%GCC accounts for

of the worldwide propylene capacity

2007-2011

2007-2011


12%GCC accounts for

of the worldwide polypropylene capacity

• GCCshareintheworldwidepolypropylene(PP)capacityrosefrom7%in2007to12%in2011.

• Themajorityofworldpolypropylene(PP)continuestobeproducedinAsia(includingChina).Their share of the worldwide polypropylene (PP) capacity is 50%. China is the largest single country polypropylene (PP) producer accounting for 23% of the worldwide capacity. PolypropyleneproducersinChinawereexpandingtheirpolypropylenecapacitiesatCAGRof17.1%.

• WhileEuropecontinuestobeoneofthelargestproducersofpolypropylene,therewerenosignificant capacity additions over the past years in Europe which has resulted in the decline ofitsworldwidemarketsharefrom24%in2007to17%in2011.

GCC polypropylene (PP) capacity expansion of CAGR 24.8% is the highest in the world


Worldwide polypropylene (PP) capacity reached

8%Worldwide

polypropylene capacity expanded at CAGR

(2007-2011)

3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Polypropylene (PP))

Worldwide Polypropylene (PP) capacity growth (CAGR 2007-2011)

Worldwide Polypropylene (PP)CAGR: 8%


24.8%

GCC

19.0%

Africa

17.1%

China

10.3%

SouthAmerica

7.4%

Asia (excluding

China)

-0.3%Europe -3.4%

North America

24.8%GCC

polypropylene capacity expanded at CAGR

(2007-2011)

Worldwide Polypropylene (PP) capacity by region, share (%)


67%


28%

16%

24%

18%

7%6%

1%


27%

23%17%

12%

12%6% 2%

1%

Asia (excluding China) ChinaEurope North America



3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Monoethylene Glycol (MEG))

• GCCshareintheworldwideMEGcapacityrosefrom24%in2007to29%in2011.• GCCstateswererapidlyexpandingtheirMEGcapacitiesbetween2007and2011at

compoundannualgrowthrate(CAGR)of10%.AmongotherregionsoftheworldonlyChinawas expanding MEG capacity at a higher rate.

• Asia(includingChina)isthelargestMEGproducerintheworldaccountingfor46%oftheworldwide MEG capacity. GCC is the second largest producer of MEG representing 29% of the global capacity.

GCC region is the second largest MEG producer in the world after Asia

Worldwide Monoethylene Glycol (MEG) capacity by region, share (%)




24%

28%11%

22%

11%

4%

GCC Asia (excluding China)China North America

Europe South AmericaThe rest of World Africa

29%

27%

18%

14%

8% 3%1%

Worldwide Monoethylene Glycol (MEG) capacity growth (CAGR 2007-2011)

Worldwide MEG CAGR: 6%


19%

China

10%

GCC

4%


0%

SouthAmerica

-5%

Europe

-6%

NorthAmerica

0%

Africa

26.1Worldwide MEG

capacity reached


2007-20116%

Worldwide MEG capacity expanded at CAGR

29%GCC accounts for

of the worldwide MEG capacity

10%GCC MEG capacity expanded at CAGR

2007-2011


22%GCC accounts for

of the worldwideMTBE capacity

• GCCshareoftheworldwideMTBEcapacityrosefrom20%in2007to22%in2011.• WhileMTBEcapacitiesworldwideweredecreasing,Asia(includingChina)andGCCwere

expanding their MTBE capacities. • MTBEcapacityinChinagrewatCAGRof15%thestrongestgrowthworldwide.GCC

producerswereexpandingtheirMTBEcapacitiesatCAGRof2%between2007and2011.• Asia(includingChina)isthelargestMTBEproducerintheworldaccountingfor38%ofthe

world’s MTBE capacity. China alone represents 26% of the global MTBE capacity.

GCC region is the second largest MTBE producer in the world after Asia


Worldwide MTBEcapacity reached

1%Worldwide

MTBE capacity decreased by CAGR

(2007-2011)

3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (Methyl tert-butyl ether (MTBE))

Worldwide MTBE capacity by region, share (%) 2007

Total: 18.7 Million Tones


67%

15%

20%

19%

23%

10%

8%5%

China GCCEurope North America

Asia (excluding China) South AmericaThe rest of World


26%

22%18%

14%

12%

5%3%

2%GCC

MTBE capacityexpended at CAGR

(2007-2011)

Worldwide MTBE capacity growth (CAGR 2007-2011)


Worldwide MTBE CAGR: -1%

15%

China

4%


2%

GCCEurope

-10%

The rest ofWorld

-11%

SouthAmerica

-13%

NorthAmerica

-2%


5%Worldwide DAP capacity

expanded at CAGR

3.1.8 Share of GCC top 10 Products in the Worldwide Capacity (DAP)

• GCCshareintheworldwideethylenecapacityrosefrom1%in2007to5%in2011.• GCChasexpandedit’sDAPcapacitybetween2007and2011atcompoundannualgrowth

rate(CAGR)of61%.Itisthehighestregionalcapacityexpansionrateintheworld.• Asia(includingChina)isthelargestDAPproducerintheworldaccountingfor42%ofthe

global DAP Capacity. China alone represents 32% of the world’s DAP capacity.• GCCisarelativelyminorproducerofDAPaccountingfor5%oftheworldwideDAPcapacity.

GCC Diammonium phosphate (DAP)’s capacity expansion of CAGR 61% is the higest in the world

Worldwide Monoethylene Glycol (MEG) capacity by region, share (%)



2011Total: 73 Million Tones

25%

27%14%

12%

11%

7%

1%3%

China North America

Europe Asia (excluding China)


GCC South America

32%

22%11%

11%

10%

6%

5%3%


Worldwide DAP CAGR: 5%

Worldwide DAP capacity growth (CAGR 2007-2011)

61%

GCC

11%

China

6 %

SouthAmerica

5%

Africa

1%

Asia(excluding

China)

0%

North America

0%

The rest ofWorld

-1%Europe

73Worldwide DAP

capacity reached


2007-2011

61%GCC DAP capacity expanded at CAGR

5%GCC accounts for

of the worldwide DAP capacity

2007-2011


2011 global ranking of GCC top 10 products

Capacity expansions for the major GCC products were the highest among other regions of the world

3.1.9 Global Ranking of GCC top 10 Products

Product Name

GCC Capacity (million tons)

Global share (%)

CAGR (2007-2011)

Global Ranking (CAGR)

Global Ranking

(Capacity)*

Ethylene 22.3 15% 15.7% 1 4

Urea 12.7 7% 6% 1 4

Polyethylene 11.8 12% 12.4% 2 4

Ammonia 11.4 5% 11% 2 5

Methanol 9.9 12% 4% 4 3

Propylene 7.7 7% 27% 1 4

Polypropylene (PP) 7.6 12% 25% 1 4

Monoethylene Glycol (MEG) 7.6 29% 10% 2 2

Methyl tert-butyl ether (MTBE) 4.0 22% 2% 3 2

Diammonium phosphate (DAP) 3.4 5% 61% 1 7

Note: Global ranking considers regional growth rates (CAGR) between 2007 and 2011 and regional capacities for individual products



• PetrochemicalscapacitycontinuestoexpandintheGCC.In2011,totalGCCpetrochemicalscapacitygrewby10%,reaching121milliontonsperannum.Between2007and2011regionalpetrochemicalscapacityexpandedatCAGRof13.4%.

• SaudiArabiaisthelargestpetrochemicalproducerintheregion,accountingfor67%ofthetotalGCCpetrochemicalscapacity.WithnewcapacityadditionsinotherGCCcountries,SaudiArabia’s share in the regional petrochemicals capacity in 2011 has declined by 3% compared withhighest70%in2007.

• Qatarcontinuestobethesecondlargestpetrochemicalsproducerintheregionaccountingfor14%ofthetotalGCCcapacityin2011.In2011Qataradded5.3milliontonsofnewpetrochemicalscapacity.ThisbringsQatar’stotalpetrochemicalscapacityto16.7milliontonsperannum.In2011comparedto2010Oman,KuwaitandtheUAEhaveeachseenadecreaseof1% in their country’s share of the total regional petrochemicals capacity.

o Oman’ssharein2011hasdeclinedto7%from8%in2010; o Kuwait’ssharein2011hasdeclinedto6%from7%in2010; o UAE’ssharein2011hasdeclinedto5%from6%in2010• Bahraincontinuestoaccountfor1%oftheGCCpetrochemicalscapacity

GCC petrochemicals sector continues to expand

3.2.1. GCC Production Capacity

GCC Petrochemicals Capacity by Country


Mill

ions

Ton

s

Saudi Arabia Qatar Oman Kuwait UAE Bahrain

51 5466 75 81

10 1010

1117

5 57

99

4 4

58

8

2

73 76

92

110121

2

2

66

0

20

40

60

80

100

120

140

2007 2008 2009 2010 2011

CAGR: 13.4%

GCC Petrochemicals capacity

grew at CAGR of 13%

between 2007-201113.4% year-on-year growth of GCC

Petrochemicals Capacity in 2011

10%year-on-year growth of Qatar petrochemicals capacity in

2011

46%


of GCC petrochemicals capacity in 2011

Saudi Arabiaaccounts for

67%

GCC Petrochemicals Capacity, Country Share




Saudi Arabia QatarOman KuwaitUAE Bahrain

70%

13%

6%

6%3%2%

67%

14%

7%

6%5%1%

GCC Petrochemicals Capacity Growth by Country (CAGR, 2007-2011)

GCC CAGR: 13.4%


26%

17% 16% 15%12%

2%

UAE Oman Kuwait Qatar Saudi Arabia Bahrain


• In2011,GCCcountriesproduced45.4milliontonsofbasicpetrochemicals.Thisisa2%growthincomparisonwiththepreviousyear.Lookingatthelongerperiodbetween2007and2011,regionalbasicpetrochemicalscapacitygrewatCAGRof15%.

• SaudiArabiacontinuestobethelargestbasicpetrochemicalsregionalproducer,accountingfor69% of the GCC total. In 2011, the country’s capacity to produce basic petrochemicals reached 31 milliontons.Overtheperiod2007to2011,SaudiArabia’sbasicpetrochemicalscapacityhasbeengrowingatCAGR11%.

• QataristhedistantsecondlargestproducerofbasicpetrochemicalsintheGCCaccountingfor9%oftheregionalcapacityor4.3milliontons.SignificantcapacityadditionsinQatartookplacein2010and2011whencapacitygrewby59%and23%respectivelyonyear-on-yearbasis.

In 2011 GCC basic petrochemicals production capacity reached 45.4 million tons

3.2.2. Basic Petrochemicals: Breakdown by Country

GCC Basic Petrochemicals Capacity by Country, Million Tons



0

5

10

15

20

25

30

35

40

45

50

20.6

26.4 27.2

32.6

44.4 45.4

2.21.41

2007

21.3

2.21.41

2008

25.7

2.22.41

2009

30.9

3.53.433

2010

31.2

4.33.433

2011

Mill

ion

Tons

CAGR: 15%

GCC Basic Petrochemicals Capacity by Country, Share (%)2007




78%

8%

5%

5% 2%2%

69%

9%

8%

7%6% 1%


Saudi Arabia accounts for the majority of the basic

petrochemicals capacity with

69%of the region’s total

23%year-on-year increase

of basic petrochemicals capacity in 2011


Basic petrochemicals capacity grew at CAGR

between 2007-2011

15%

UAE basic petrochemicals capacity grew at CAGR

the highest in the GCC region

48%

• KuwaitandOmaneachrepresent7%oftheregionalbasicpetrochemicalsproductioncapacity.In2011bothcountrieshadthecapabilitytoproduce3.4milliontonsofbasicpetrochemicals.Comparedwiththeirrespectivecapacitiesin2007,KuwaitandOmanhadoneofthehighestcompounded annual growth rates in the region. Basic petrochemicals capacity in Kuwait grew at CAGR27%and25%inOman.

• BasicpetrochemicalscapacityintheUAEreached2.9milliontonsperannumin2011accountingfor6%oftheregionalcapacity.From2007-2011themostsignificantcapacityadditionintheUAEtookplacein2010.

• In2011Bahrain’sshareoftheregionalbasicpetrochemicalsproductioncapacityremainedat1%.

GCC Basic Petrochemicals Capacity Growth , CAGR (2007-2011)


GCC CAGR: 15%

48%

UAE Kuwait Oman

18%

Qatar

11%

Saudi Arabia3%

Bahrain

27% 25%


GCC fertilizers capacity grew at CAGR

2007-201111%

• In2011GCCfertilizerscapacityreached27.4milliontonswhichisa36%increaseover2010level.Inthepastyearsbetween2007and2011regionalfertilizersindustrygrewatCAGRof11%.

• In2011SaudiArabiaandQataraccountfor40%and28%respectivelyoftheGCCfertilizerscapacity making them the largest in the region.

• InbothSaudiArabiaandQatartheonlycapacityadditionbetween2007and2011tookplacein2011when4milliontonsoffertilizerscapacitieswerebroughtonlineinSaudiArabiaand3.3million tons in Qatar.

• In2011Oman’sfertilizercapacityisestimatedtobe4.8milliontons.From2007-2011fertilizercapacityinOmanexpandedataCAGRof14%

• WithnofertilizerscapacityadditionsinKuwaitandtheUAE,theirshareintheregionalfertilizerscapacityhasdeclined.In2011Kuwait’sshareintheregionalfertilizerscapacitydeclinedto6%andtheUAE’ssharedeclinedto5%.

• FertilizerscapacityinBahrainaccountsfor4%ofregionalcapacity.

In 2011 Saudi Arabia and Qatar have significantly increased their fertilizers capacities

3.2.3 Fertilizers: Breakdown by Country

million ton of GCC fertilizers capacity in 2011

27.4

GCC Fertilizers Capacity by Country, Million Tons


7.0 7.0 7.0 7.011.0

4.4 4.44.4

4.4

7.72.8

18.2 18.2 19.520.1

27.4

2.8 4.2 4.8

4.8

1.7 1.71.7 1.7

1.7

1 11 1

1

1 11 1

1

0

5

10

15

20

25

30

2007 2008 2009 2010 2011

Mill

ions

Ton

s


CAGR: 11%

36%year-on-year increase of

the GCC fertilizers capacity in 2011


The top three producersof fertilizers in the

GCC are

SaudiArabia,

Qatarand

OmanGCC Fertilizers Capacity Growth, CAGR (2007-2011)


15%

Qatar

14%

Oman

12%

Saudi Arabia

1%

Bahrain

0%

UAE

0%

Kuwait

GCC CAGR: 11%

GCC Fertilizers Capacity by Country, Share (%)





39%

24%

16%

9%

7%5%

40%

28%

17%

6%5% 4%


• GCCintermediateproductscapacityislocatedinSaudiArabia,KuwaitandQatar.• In2011GCCintermediateproductscapacityreached9.9milliontonsperannum.From2007-

2011GCCintermediatescapacitywasexpandedatacompoundannualgrowthrate(CAGR)of 21%.

• ThemajorityofintermediateproductsareproducedinSaudiArabiawhichaccountsfor89%of the regional capacity. Saudi Arabia is the largest producer of intermediate products and expandeditscapacityataCAGR(2007-2011)of22%.Since2007SaudiArabia’scapabilitytoproduceintermediateproductshasmorethandoubledfrom4milliontonsto8.8milliontonsin 2011.

• IntermediateproductsproductioninKuwaitcommencedin2009.In2011Kuwait’scapacityofintermediate products accounts for 5% of the regional capacity.

Majority of intermediate products are produced in Saudi Arabia which accounts for 89% of the regional capacity

3.2.4 Intermediates: Breakdown by Country

GCC intermediates capacity by country, Million Tons


4.06.3 7.3 7.9 8.80.5

0.60.6

0.60.6

0.50.5

0.5

0

2

4

6

8

10

12

2007 2008 2009 2010 2011

Saudi Arabia Qatar Kuwait

CAGR: 21% 9.99.0

8.4

6.9

4.5

GCC intermediate products capacity grew at CAGR

21%

year-on-year growth of intermediate products capacity

in Saudi Arabia in 2011

12%

GCC Intermediates Capacity by Country, Share (%)



12%

88%


89%

6%5%

Saudi Arabia Qatar Kuwait

2007-2011


16.5% between 2007-2011

GCC polymers capacitygrew at CAGR

75%of the GCC polymers capacity is located in

Saudi Arabia

38%UAE

polymers capacity expands at CAGR of

between 2007-2011

19.2%Qatar

polymers capacity expands at CAGR of

between 2007-2011

GCC Polymers Capacity by Country, Million Tons


8.6

0.9

2007

8.8

0.9

2008

13.7

0.9

2009

15.0

2.01.31.0

2010

15.4

2.01.71.0

2011

Mill

ion

Tons

Saudi Arabia UAE Qatar Kuwait Oman

11 11.2

16.2

19.6 20.4CAGR: 16.5%

0

5

10

15

20

• GCCpolymerscapacityispresentinallGCCstatesexceptforBahrain.• In2011GCCpolymerscapacityreached20.4milliontons.Between2007and2011GCC

polymerscapacitywasexpandingatcompoundannualgrowthrate(CAGR)of16.5%.• 75%oftheGCCpolymerscapacityislocatedinSaudiArabia.Asof2011polymerscapacityin

SaudiArabiaisestimatedat15.4milliontons.Since2007SaudiArabia’spolymerscapacityhasalmostdoubledfrom8.6to15.4milliontonsin2011.TheUAEisthesecondlargestproducer of polymers in the region and represents 10% of the regional polymers capacity. The mostsignificantpolymerscapacityexpansionintheUAEtookplacein2010when1.4milliontons of polymer capacity was brought on stream.

• With1.7milliontonesofpolymerscapacityQataraccountsfor8%ofGCCtotal.Polymerscapacity additions in Qatar over the past few years have doubled its polymer capacity.

• Kuwaitcontinuestoholdits5%shareoftheregionalpolymerscapacity.In2011polymerscapacityinKuwaitreached1.7milliontons.

• GCCpolymerscapacityexpansionindexin2011roseto184points.Analyzingeachcountry’sindividualcapacityexpansionindex,itisobservedthatUAEandQatarhaveoutperformedtheGCCregionalcapacityexpansionwiththeindexfortheUAEandQatarrisingto363and202respectivelyAsthemajorityofpolymerscapacityislocatedinSaudiArabia,thepolymerscapacity expansion index of Saudi Arabia and the GCC overall polymers expansion index are evolving along the same trend lines.

Saudi Arabia continues to account for the majority of regional polymers capacity and other GCC states are expanding

3.2.5 Polymers: Breakdown by Country

GCC Polymers Capacity by Country, Share (%)




78%

5%

8%

6% 3%

Saudi Arabia UAE Qatar Kuwait Oman

75%

10%

8%5%2%


3.3.1 Capacity Utilization by Country

• Petrochemicalscapacityutilizationattheregionallevelin2011hasmarginallydroppedfrom92% in 2010 to 91% in 2011.

• Atthecountrylevel,petrochemicalscapacityutilizationhasdroppedinallGCCcountriesexceptfortheUAEandBahrain.DuetotherampupperiodforthenewfacilitiesintheUAE,capacityutilizationwaslowin2010andsimprovedto84%in2011.

• CapacityutilizationinBahrainhasimprovedfrom109%in2010to113%in2011.• WhileSaudiArabiaandQatararethelargestproducersintheGCC,theircapacityutilization

hasslightlydeclinedin2011whencomparedto2010.ThelargestdeclineincapacityutilizationtookplaceinQatarwhereitdeclinedby13%.Thisisduetothestart-upofnewfacilitiesandtime required to achieve target production.

• CapacityutilizationinKuwaithasdeclinedby5%from96%in2010to91%in2011.• Omanhasoneofthehighestcapacityutilizationratesintheregion.In2011overallcapacity

utilizationreached96%,thisisadeclineof2%from2010level.

2011 capacity utilization has marginally declined across GCC except for the UAE and Bahrain


2011 Y-o-Y change in GCC capacity utilization by country, %

26%

UAE

3%

Bahrain -1%

Saudi Arabia

-3%

Oman

-5%

Kuwait

-13%

Qatar

Y-o-Y change of GCC capacity utilization: -1%

91%overall capacity utilization

in the GCC in 2011

1%Decline of

in capacity utilization in the GCC in 2011

GCC Petrochemicals capacity utilization by country, %


2011 Capacity Utilizaton 2010 Capacity Utilization

59%

96%

92%

92%

106%

98%

109%

UAE

Kuwait

Saudi Arabia

GCC

Qatar

Oman

Bahrain

84%

91%

91%

91%

92%

96%

113%

UAE

Kuwait

Saudi Arabia

GCC

Qatar

Oman

Bahrain


• GCCCapacityutilizationacrossallproductgroupshasimprovedexceptforfertilizerswhichhavedroppedfrom104%in2010to81%in2011.Thisisduetorampupperiodrequiredtostartnewfertilizersfacilities.LowerfertilizerscapacityutilizationhasdraggeddowntheoverallGCCpetrochemicalscapacityutilizationfrom92%in2010to91%in2011.Productionofintermediate and specialties products is operating at the highest operating rate for the second consecutive year.

• Thelargestimprovementinoperatingrateswasobservedwithinbasicpetrochemicalsgroup.Theircapacityutilizationroseto94%from89%in2010.

• Thoughpolymersproductionhasoneofthelowestutilizationrates,itscapacityutilizationhasimprovedto89%in2011.

• In2011chemicalscapacityutilizationstoodat96%,whichisanincreaseof2%over2010.

In 2011 capacity utilization for most products improved

5%in 2011

Basic petrochemicals producers have improved

their capacity utilization by

94%operating rates of basic

petrochemicals units in the GCC in 2011

96%utilization of capacities for

production of chemicals

3.3.2 Capacity Utilization by product group


2011 Y-o-Y change in capacity utilization by product groups, %

Y-o-Y change of overall capacity utilization:

-1%

6 % 4 % 2 % 2 % 0 %

-23 %

Basic Polymer Intermediate Chemical Specialities Fertilizers

GCC Petrochemicals capacity utilization by product groups, %


104%

85%

92%

89%

94%

100%

98%

Fertilizers

Polymer

All Products

Basic

Chemical

Specialities

Intermediate

81%

89%

91%

94%

96%

100%

100%

Fertilizers

Polymer

All Products

Basic

Chemical

Specialities

Intermediate

2011 Capacity Utilizaton 2010 Capacity Utilization

23%decrease in capacity utilization of fertilizers

in 2011


C3 (Propylene) value-chain production recorded

lowest utilization rate of

81%

3.3.3 Capacity Utilization by Value-chain

• In2011GCCcapacityutilizationofEthylene(C2)productswas93%,animprovementof1%over 92% in 2010.

• In201181%ofPropylene(C3)productscapacitywasusedbyGCCproducers,thisisa6%improvementover2010.Propylene(C3)capacityutilizationcontinuestobethelowestamongwhencomparedtoothervalue-chains

• ThemostsignificantdeclineincapacityutilizationwasobservedinproductionofMethanol(C1)value-chainproducts.In2010plantsproducingproductsbasedonMethanewereoperatingat102%capacity,in2011theircapacityutilizationhasdeclinedto94%.However,Methanolvalue-chain(C1)productscapacityutilizationremainshighestwhencomparedtoothervalue-chains.

• In2011aromaticscapacityutilizationwas92%whichrepresentsadeclineof2%from94%in 2010.

Production of all value chain products was operating at utilization rate above 90% except for the propylene value-chain products

GCC Petrochemicals capacity utilisation by product value chain, %


2010 Capacity Utilization 2011 Capacity Utilizaton

C3 propylene

All Products

Aromatics

C4 Butadiene

C2 Ethylene

C1 Methanol

C3 propylene

All Products

Aromatics

C4 Butadiene

C2 Ethylene

C1 Methanol

74%

92%

94%

94%

92%

102%

81%

91%

92%

92%

93%

94%


2011 Y-o-Y Change in capacity utilization by product value chains, %

Y-o-Y change of overall capacity utilization: -1 %

6 %

C3 propylene

1 %

C2 Ethylene

-2 %

C4 Butadiene

-2 %

Aromatics

-8 %

C1 Methanol

94%of capacity utilization of

C1 (Methanol) value-chain products in 2011


• Overallcapacityutilizationofbasicpetrochemicalsreached94%in2011whichisanimprovementof4%from2010levels.

• ProductionofToluenecontinuesatmaximumoperationrateof100%duetolimitedcapacityavailability.

• ProductionofMethanolandBenzenecontinuetoutilizemostoftheirinstalledcapacitywithimprovement of 1% over the previous year reaching 99% and 93% respectively.

• In2011GCCproducersofEthyleneincreasedtheircapacityutilizationby10%to98%whichisthehighestyear-on-yearimprovementcomparedtootherbasicpetrochemicals.

• Butadieneproductioncapacityutilizationhasdroppedby8%from98%in2010to90%in2011.Butadieneproductioncapacityutilizationin2011isslightlylowerthantheoverallcapacityutilization.Propylenehasthelowestcapacityutilizationof80%butremainsoneofthemajorbasicpetrochemicalsproducedintheGCC.

Most basic petrochemicals was operating at utilization rate above 90% except for Propylene and Mixed Xylenes

4%improvement in overall

capacity utilization of basic petrochemicals in 2011

94%capacity utilization of basic

petrochemicals in 2011

9%improvement of Ethylene

capacity utilization in 2011

3.3.4 Basic Petrochemicals Capacity Utilization by Product


2011 Y-o-Y change in basic petrochemicals capacity utilization by product, %

Y-o-Y overall capacity utilization improved by 4%

9%

Ethylene

1%

Benzene

0.5%

Methanol

0%

Toluene -1%Propylene

-5%Mixed Xylenes

-8%Butadiene

80%

87%

91%

93%

94%

98%

99%

100%

GCC Basic petrochemicals capacity utilization by product, %

2010 Capacity Utilization 2011 Capacity Utilization


Propylene

Mixed Xylenes

Butadiene

Benzene

Ethylene

Methanol

Toluene

Propylene

Mixed Xylenes

Butadiene

Benzene

BasicPetrochemicals

BasicPetrochemicals

Ethylene

Methanol

Toluene

81%

92%

98%

92%

90%

88%

98%

100%


3.3.4 Basic Petrochemicals Capacity Utilization by Product

• KuwaitandQatararerunningatthehighestEthylenecapacityutilizationforthesecondconsecutive year.

• GCCoverallEthylenecapacityutilizationisdrivenbySaudiArabiawhichisthelargestEthyleneproducerintheregion.In2010capacityutilizationofEthyleneinSaudiArabiawas88%in2010andhasimprovedin2011reaching99%.ConsequentlyGCCEthylenecapacityutilizationhasalsoimprovedreaching98%in2011.

• In2010,EthylenecapacityutilizationintheUAEwaslowduetothestartupperiodrequiredfornewfacilities.In2011Ethyleneproductionwasoperatingathigherrateof87%.

Saudi Arabia and the UAE significantly improved their Ethylene capacity utilization in 2011

GCC Ethylene capacity utilization by country, %



68%

88%

88%

99%

100%

87%

98%

99%

99%

100%

UAE

GCC Ethylene

Saudi Arabia

Qatar

Kuwait

UAE

GCC Ethylene

Saudi Arabia

Qatar

Kuwait


2011 Y-o-Y change in Ethylene capacity utilization by country, %

GCC Ethylene capacity utilization improved by 10%

19 %

UAE

11 %

Saudi Arabia

1 %

Qatar

0 %

Kuwait

11%year-on-year improvement in

Ethylene capacity utilization in Saudi Arabia in 2011

19%year-on-year improvement in Ethylene capacity utilization

in the UAE in 2011


4%Regional polymers

capacity utilization has improved by

• In2011polyethyleneproductionfacilitieswereoperatingatacapacityutilizationof98%.Thisrepresentsa5%improvementoverthe2010capacityutilizationof93%.Capacityutilizationofpolypropylenefacilitiesimprovedby6%from71%in2010to77%in2011.

Regional polymers capacity utilization in 2011 has improved

98%

3.3.5 Polymers Capacity Utilization by Product


2011 Y-o-Y change in polymers capacity utilization by product,%6%

PP

5%

Polyethylene

-8%

PVC 0%

EPS

0%

PET

0%

PS

0%

PVC

GCC polymers capacity utilisation improved by 4%

GCC polyethylene capacity utilization in

2011

GCC Polymers capacity utilization by product, %



PC

PP

Polymers

Polyethylene

EPS

PET

PS

PVC

71%

0%

85%

93%

100%

100%

100%

108%

25%

77%

89%

98%

100%

100%

100%

100%

PC

PP

Polymers

Polyethylene

EPS

PET

PS

PVC


3.3.6 Fertilizers Capacity Utilization by Product

• FertilizersfacilitiesintheGCCwereoperatingat83%oftheircapacitiesin2011.Thisissignificantdecreasefrom2010capacityutilizationandisduetonewfacilitiesstartingupinthe GCC which were ramping up their production during 2010.

• Ureacapacityutilizationcontinuestobethehighestamongotherfertilizers.Ureaproducingplantsoperatedat101%in2011,slightlylowerthan106%capacityutilizationin2010.

• Ammoniaproducingplantswereoperatingattherateof84%in2011whichislowerthaninthe previous year.

• Withnewplantsstartingupin2011,DAPfacilitiesarestillrampinguptheirproductionandthisresultsinthelowcapacityutilizationof14%.

Overall capacity utilization for fertilizers sector has declined due to start-up of new facilities

GCC Fertilizers capacity utilization by products, %



31%

106%

104%

106%

Diammoniumphosphate (DAP)

Ammonia

All Fertilizers

Urea

14%

84%

83%

101%

Diammoniumphosphate (DAP)

Ammonia

All Fertilizers

Urea


2011 Y-o-Y change in fertilizers capacity utilization by products, %

All fertilizer capacity utilization decrease by 21%

-22 %

-18 %

-5 %Ammonia Diammonium

phosphate(DAP)

Urea

83%capacity utilization of

fertilizers facilities in 2011

101%capacity utilization of urea

facilities


• Overallpetrochemicalscapacityutilizationrateinotherregionsremainsat75%-78%whichislowerthanGCCpetrochemicals91%capacityutilizationrecordedin2011.

• WhileAsiaisthelargestpetrochemicalsproducerintheworld,itscapacityutilizationin2011hasdroppedby1.1%reaching77%

GCC petrochemicals capacity utilization is higher than in other regions worldwide

78%worldwide

petrochemicals capacity utilization rate in 2011

91%GCC petrochemicals

capacity utilization rate in 2011

3.3.7 Worldwide Comparison of the GCC Capacity Utilization

Worldwide petrochemicals capacity utilization by region, %



75%

75%

75%

76%

78%

78%

77%

92%

Africa

South America

Europe

North America

Asia

World

Rest of the World

GCC

73%

74%

75%

76%

77%

78%

78%

91%

Africa

South America

Europe

North America

Asia

World

Rest of the World

GCC

Source: Mitsubishi Chemical Techo-Research Corporation (MCTR) and GPCA database, October 2012

2011 Y-o-Y change in petrochemicals capacity utilization by region, %

-0.2%

NorthAmerica

-0.6%

Europe

-0.6%

SouthAmerica

-1.1%

Asia

-1%

GCC

-2.5%

Africa


3.3.8 Worldwide Comparison of the GCC Ethylene Capacity Utilization

• EthylenecapacityutilizationintheGCCreached98%in2011whichisthehighestintheworld.• WhileEthylenecapacityutilizationin2011hasimprovedinmostregions,GCCandChina

recordedthehighestyear-on-yearimprovementof10%and8%respectively.• EuropeandNorthAmericawitnessedthelowestEthylenecapacityutilizationforthesecond

consecutiveyearreaching79%and82%respectively.

GCC Ethylene capacity utilization is the highest among other regions worldwide


2011 Y-o-Y change in Ethylene capacity utilization by region,%10%

GCC

8%

China

1%

Africa

1%

SouthAmerica

1%

Europe

0%

NorthAmerica

-8%

Asia(excluding

China)

Y-o-Y worldwide capacity utilization change - 0%

10%year-on-year improvement of GCC Ethylene capacity

utilization in 2011

8%year-on-year improvement of UAE Ethylene capacity

utilization in 2011

85%Worldwide Ethylene capacity utilization in

2011 remains at

Worldwide Ethylene capacity utilization by region, %



78%

82%

85%

93%

85%

84%

95%

88%

Europe

North America

Worldwide



South America

China

Africa

GCC

79%

82%

85%

85%

85%

92%

96%

98%

Europe

North America

Worldwide

South America

China

Africa

GCC


11million tons of additional

capacity came on stream in 2011

38%year-on-year decline in

capacity additions in 2011

3.4.1 Capacity additions: breakdown by country

• In2011,GCCproducersbroughtonline11milliontonesofadditionalcapacitybringingtotalGCC capacity to 121 million tons.

• Newcapacityadditionin2011is38%lowerthanin2010whenGCCproducersbroughtonline17.9milliontonsofpetrochemicalscapacity.

• SaudiArabiacontinuestoleadcapacityexpansionsintheregionaccountingforthe52.3%ofthe new capacity being commissioned in 2011.

• Qatarbroughtonline5.2milliontonsoftheadditionalpetrochemicalscapacityin2011whichaccountsfor47.3%ofthecapacityadditionsintheGCC.

In 2011, petrochemicals capacity additions took place in Saudi Arabia and Qatar



GCC Petrochemicals Capacity Additions by Country, 2010-2011

46.9%

10.3%

9%

13.3%

20.5%0.2%

2010 additional capacity,Total: 17.9 Million Tons

52.3%47.3%

0.4%

2011 additional capacity,Total: 11 Million Tons




3.4.2 Capacity additions: breakdown by product group

• In2010,themajorityofcapacityadditionsintheGCCweredrivenbythebasicpetrochemicalswhichaccountedfor66%.WhileGCCcountriescontinuedtoexpandbasic petrochemicals capacities, its share of capacity additions has declined to 10%.

• Fertilizersaccountedforthemajority(66%)ofadditionalcapacitywhichcameonstreamin 2011.

• Therewere3.4milliontonsofpolymerscapacityadditionsin2010,whichaccountedfor19% of the GCC total additions in the same year. Polymers capacity continues to expand, howeverin2011therewasonly0.8milliontonsofpolymerscapacityadditionswhichaccountedfor7%ofthetotal.

• ChemicalscapacityexpansionstookplaceintheGCCinboth2010and2011.Thechemicalsshareofthecapacityadditionsremainedat8-9%,howeverthetotalcapacityof chemicals producing facilities that came on stream in 2011 is smaller than in 2010. The chemical’s capacity in 2011 and 2010 was 0.9 million tons and 1.5 million tons respectively.

Fertilizer account for the majority of regional capacity additions in 2011

GCC Petrochemicals Capacity Additions by product group, 2010-2011

2010 Additional Capacity,Total 17.9 Million Tons

2011 Additional CapacityTotal: 11.1 Million Tons


Basic

Polymer

Chemical

Intermediate

Fertilizers

Specialities

Basic

Polymer

Chemical

Intermediate

Fertilizers

Specialities


66%

19%

9%

3%3%

10%

7%

8%

9%

66%

11.1million tons of

petrochemicals capacity additions in 2011

7.3million tons of fertilizers

capacity was brought online in 2011


69%of the regional Ethylene

capacity is in Saudi Arabia

16%GCC Ethylene capacity

grew at CAGR

between 2007-2011

37%UAE Ethylene


27%Qatar ethylene


between 2007-2011

3.4.3 Basic petrochemicals capacity growth (2007-2011): (Ethylene)

• Between2007and2011GCCEthylenecapacityalmostdoubledfrom12.4in2007to22.3milliontonsin2011.ThisrepresentedCAGRof16%.Themajorityofcapacityadditionstookplacein2010whenGCCcountriesadded6.8milliontons.Thisis70%ofallthenewEthylenecapacitythatwasbroughtonstreambetween2007and2011.

• GCCEthylenecapacitygrowthindexisfollowingthesametrendastheindexofcapacitygrowthforallbasicpetrochemicalsintheGCC.In2011Ethylenecapacityindexhasreached179comparedto2007=100.

• SaudiArabiaaccountedfor69%oftheregionalEthylenecapacityin2011.WhileEthylenecapacitywasexpandingatCAGRat12%between2007and2011,SaudiArabia’ssharehasdecreasedby10%to69%from79%in2007.

• Between2007and2011Qatar,UAEandKuwaithavebeenrapidlyexpandingtheirEthylenecapacities.EthylenecapacityintheUAEhadthehighestgrowthofCAGR37%.Asaresult,theUAE’sshareintheregionalethylenecapacityroseto9%in2011.

• ProducersinQatarweredevelopingtheirethylenecapabilitiesbetween2007and2011atCAGRof27%.Qatarcontinuestobethesecondlargestproducerofethyleneintheregionaccountingfor15%oftheregionalcapacity.Thisis5%increasefromthecountry’ssharein2007.

• EthylenecapacityinKuwaitbetween2007and2011hasdoubled.ConsequentlyKuwait’sshareoftheregionalethylenecapacityhasincreasedfrom6%in2007to7%in2011.

Over the past years GCC countries have been expanding their Ethylene production capacities

GCC Ethylene Capacity Million Tons


12.4

22.3

2.3

6.8

2007 2008 2009 2010 2011

CAGR: 16%

GCC Ethylene Capacity by Country, Share %

Saudi Arabia Oman Qatar Kuwait




79%

10%

5%6%

69%

15%

9%

7%

between 2007-2011


3.4.3 Basic petrochemicals capacity growth (2007-2011): (Methanol)

• Between2007and2011GCCMethanolcapacitygrewataCAGRof4%.In2011annualproductioncapacityofMethanolreached9.9milliontons.Overtheperiodbetween2007and2011, the largest Methanol capacity addition in the GCC took place in 2010 when 1 million tons of capacity was brought on stream.

• GCCMethanolexpansionindexin2011reached117pointswhichislowerthanexpansionindexofbasicpetrochemicalsasatotal.Since2008,Methanolcapacityexpansionhasbeenslower than the overall expansion of basic petrochemicals.

• SaudiArabiacontinuestobethelargestproducerofMethanolintheregionaccountingfor65%ofGCC’sMethanolcapacity.Withsignificantcapacityalreadyinplace,SaudiArabiahasnot made any significant Methanol capacity additions over the past years.

• OmanisthesecondlargestproducerofMethanolintheGCCaccountingfor20%shareintheregionalcapacityin2011.Between2007and2011MethanolcapacityinOmandoubledandreached2milliontonsperannum.ThisrepresentsaCAGRof19%,whichisthehighestintheGCC

• Qatarmaintainsits11%-12%shareoftheregionalmethanolcapacity.In2011QatarMethanolproduction capacity reached 1 million tons.

Majority of GCC methanol capacity is located in Saudi Arabia

GCC Methanol capacity growth by year, Million Tons


8.4

9.90.3

1.0

2007 2008 2009 2010 2011

CAGR 4 %

GCC Methanol capacity by country, Share %

Saudi Arabia Oman Qatar Bahrain

2007Total 8.4 Million Tons

2011Total 9.9 Million Tons


72%

12%

12%4%

65%

20%

11%4%

4%GCC Methanol capacity

CAGR between 2007-2011 is

65%of the regional

Methanol capacity is in Saudi Arabia

19%Methanol capacity

growth in Oman of CAGR

is highest in the region


3.4.3 Basic petrochemicals capacity growth (2007-2011): Propylene

• GCCPropylenecapacityreached7.7milliontonsperannumin2011.In2009and2010GCCproducersbroughtonstreamsignificantpropylenecapacities.Thisaccountsfor83%ofthetotalpropylenecapacityadditionsbetween2007and2011.

• GCCpropylenecapacityexpansionindex(basedon2007=100)hasbeenhigherthantheregional index covering all basic petrochemicals and reached 260 points in 2011.

• SaudiArabiamaintainsitspositionasthelargestpropyleneproducerintheregionaccountingfor83%oftheregionalpropylenecapacity.PropylenecapacityinSaudiArabiagrewatCAGRof27%between2007and2011.

• TheUAEhasemergedasthesecondlargestproducerofpropyleneintheGCCaccountingfor10% share of GCC propylene capacity in 2011.

• Since2007KuwaithasbeenexpandingitspropylenecapacityatCAGR11%.ShareofKuwaitinthe total regional propylene capacity declined to 2% in 2011.

2007-2011 GCC propylene capacity expansion is driven by Saudi Arabia

27%between 2007-2011

GCC Propylene capacity grew at CAGR 27%

27%Propylene capacity in

Saudi Arabia expanded at CAGR of

GCC Propylene Capacity, Million Tons


3.0

7.70.5

1.8

2.2

2007 2008 2009 2010 2011

CAGR: 27%

GCC Propylene Capacity by Country, Share %

Saudi Arabia UAE Oman Kuwait




83%

13%

4%

83%

10%5% 2%

between 2007-2011


3.4.3 Basic petrochemicals capacity growth (2007-2011): Benzene

• Between2007and2011GCCbenzenecapacitywasgrowingatCAGR13%reaching2.9milliontonsperannumin2011.WhileGCCproducerswereexpandingtheirbenzenecapacitiesovertheyears,themajorityofbenzenecapacitywasaddedin2010when0.7mtpaofbenzenecapacitycapeonstream.

• Benzenecapacityexpansionindexhasbeenraisinginthesimilartrendlinesasanoverallexpansionindexforallbasicpetrochemicals.In2011benzeneindexarrivedat162pointswhileoverallbasicpetrochemicalsat171points.

• ThemajorityoftheregionalbenzenecapacityislocatedinSaudiArabiawhichaccountsfor67%ofthebenzenecapacity.WhileSaudiArabiacontinuedtoexpanditsbenzeneproducingfacilitiesatCAGRof8%,itsshareintheregionhasdecreasedfrom78%in2007tocurrent67%.

• Kuwaitisthesecondlargestbenzeneproducerintheregioncontributing26%totheregionalcapacity.TherehasbeenanotablebenzenecapacityexpansiongrowthinKuwaitofCAGR18%between2007and2011.

• In2007regionalbenzenecapacitywasconcentratedinSaudiArabiaandKuwait.SincethenOmanhasemergedasabenzeneproducerandnowaccountsfor7%oftheregionalbenzenecapacity.

GCC benzene capacity continue to be concentrated in Saudi Arabia and Kuwait with Oman emerging as benzene producer

GCC Benzene capacity growth by year, Million Tons


1.8

2.9

0.20.1

0.7

2007 2008 2009 2010 2011

CAGR 13%

GCC Benzene capacity by country, Share %

78%

22%

67%

26%

7%

Saudi Arabia Oman Kuwait




13%GCC Benzene capacity

grew at CAGR

67%of the regional

Benzene capacity is in Saudi Arabia

18%Kuwait’s Benzene

capacity grew at CAGR

8%Saudi Arabia’s benzene capacity grew at CAGR

between 2007-2011

between 2007-2011

between 2007-2011


3.4.3 Basic petrochemicals capacity growth (2007-2011): Mixed Xylenes

• Between2007and2011GCCmixedxylenescapacitygrewatCAGRof50%.Themajorityofcapacityadditionstookplacein2009and2010whenGCCcountriesadded1.7milliontonsof mixed xylenes capacities.

• GCCmixedxylenescapacitygrowthindexismuchhigherthancapacitygrowthindexforall basic petrochemicals. In 2011 mixed xylenes capacity index has reached 510 points in comparisonwith2007.

• Whilein2007mixedxyleneswereproducedonlybySaudiArabia,by2011KuwaitandOman have added mixed xylenes production capabilities as well. Kuwait and Saudi Arabia eachaccountedfor37%oftheregionalmixedxylenescapacityin2011whileOmanaccounted for 26%.

Saudi Arabia and Kuwait are largest producers of mixed xylenes

50%GCC Mixed Xylenes

capacity grew at CAGR

between 2007-2011

GCC Mixed Xylenes capacity growth by year, Million Tons


0.4

2.10.8

0.9

2007 2008 2009 2010 2011

CAGR: 50%

GCC Mixed Xylenes capacity by country, Share %

Saudi Arabia Oman Kuwait




100%

37%

37%

26%

GCC International Trade (2007-2011)4


4.1 GCC production and export

• OverthepastyearsGCCgovernmentshavebeendevelopingdownstreamindustriesinordertoutilizerawmaterialsproducedintheregion.Asaresulttheshareofpetrochemicals exports in production (excluding captive consumption) has decreased by 8%from88%in2007to80%in2011.

With development of regional downstream industries more petrochemicals are being utilized within region

80%of petrochemicals

available for sale in the GCC are exported

GCC Petrochemicals production (excluding captive consumption) and exports, share %

Export In country sales

88%

12%

80%

20%

2007Total: 42.6 million tons

2011Total: 68 million tons


* Note: Production excluding captive consumption. Captive Consumption is the consumption of products manufactured within the same factory or transfer of goods to a sister unit or another factory of the same company/firm for further use in the manufacture of goods

GCC Petrochemicals production and export, Million Tons


2007 2008 2009 2010 2011

0

10

20

30

40

50

60

70

Production (Excluding Captive Consumption) Export

43 44

52

6368

37 3943

5154



With GCC producers diversifying product portfolios, domestic consumption of basic petrochemicals is increasing

66%of basic petrochemicals are captivity consumed

by the producers

10.6million tons of basic

petrochemicals was exported from GCC in 2011

16%Between

2007 – 2011 exports of GCC basic petrochemicals grew

at CAGR

GCC Basic Petrochemicals production and captive consumption, Million Tons


2007 2008 2009 2010 20110

10

20

30

40

50

Production Captive Consumption

24 25.329.1

39.942.8

17.5 17.520.2

26.2 28.4

GCC Basic Petrochemicals production (excluding captive consumption) and exports, share %




91%

9%


74%

26%

Note: Captive Consumption is the consumption of products manufactured within the same factory or transfer of goods to a sister unit or another factory of the same company/firm for further use in the manufacture of goods

GCC Basic Petrochemicals production and export, Million Tons


0

3

6

9

12

15

2007 2008 2009 2010 2011

6.57.8

8.9

13.8 14.4

5.9 6.57.5

10 10.6




GCC petrochemicals industry remains export oriented, however share of in country sales is gradually increasing

80%of petrochemicals are

exported

43.8million tons of

petrochemicals (excluding basic petrochemicals) was exported from GCC in 2011

9%Exports of the GCC

petrochemicals (excluding basic petrochemicals)

grew at CAGR

between 2007-2011

GCC Petrochemicals (excluding basic petrochemicals) production(excluding captive consumption) and exports, share %






85%

15%

80%

20%

GCC Petrochemicals (excluding basic petrochemicals) production and captive consumption, Million Tons



0

10

20

30

40

50

60

37.2 37.843.7

50.354.9

31.5 32.435.6

40.743.8

2007 2008 2009 2010 2011


10%GCC petrochemicals

exports grew at CAGR of

between 2007-2011

54.4million tons of

petrochemicals were exported by GCC in 2011

61%of the GCC petrochemicals

exports are from Saudi Arabia

The most rapid export growth has been in

Oman,

Kuwaitand the

UAE

4.2 GCC export by origin

Saudi Arabia remains the largest petrochemicals exporter. Exports from other GCC states are increasing.

GCC Petrochemicals exports by origin, million tons

2007 2008 2009 2010 2011Saudi Arabia Qatar Oman Kuwait UAE Bahrain


Mill

ion

Tons

CAGR: 10%

0

10

20

30

40

50

60

23.6 24.5 27.4 31.6 33.2

6.7 6.86.9

7.0 7.82.7 3.0

3.76.1 6.6

2 22

33

37.4 38.9

43.150.8

54.4

• WiththeGCCpetrochemicalscapacityexpansionsoverthepastyears,exportsfromtheregionareincreasingatCAGRof10%.ThisislowerthantheGCCproductionCAGRof12%andisattributed to the growing consumption by the downstream industry in the region.

• SaudiArabiaremainsthelargestpetrochemicalsexporterfromtheregionaccountingfor61%ofthe regional export volume. Over the past years petrochemicals exports from Saudi Arabia grew atCAGR9%whichis2%lowerthanproductiongrowthoverthesameperiod.

• QataristhesecondlargestexporterintheGCCaccountingfor14%oftheregionalexportvolume.Since2007QatarexportshavegrownatCAGRof4%whichismuchlowerthantheproduction growth rate of 12%.

• Oman,asthethirdlargestexporterofpetrochemicalsfromtheregion,accountsfor12%oftheregionalexportvolume.Between2007and2011OmanwitnessedthehighestexportgrowthratewhencomparedtootherGCCstates.Oman’sexportsgrewatCAGR25%whichisaresultofadditionalexportsfromnewfacilitieswhichhavecomeonlinesince2007.

• Kuwait’sexportsgrewatCAGRof12%whichresultedintheincreaseofthecountry’sshareintheregionalexportsfrom5%in2007to6%in2011.

• TheUAE’sexportgrowthofCAGR16%isoneofthehighestintheregion.Howeverwithashareofregionalpetrochemicalsexportsof5%in2011,theUAEisaminorexporter.

Country share in the GCC Petrochemicals exports, Share %






63%18%

7%

5%4%3%

61%14%

12%

6%5%2%


55%Fertilizers and

polymers accounted for

of the GCC petrochemicals export

by volume

4.3 GCC export by product groups

The majority of GCC exports are fertilizers and polymer products

GCC Petrochemicals exports by product groups, Million Tons


CAGR: 10%

Mill

ion

Tons

0

10

20

30

40

50

60

14.7

8.4

7.9

5.90.5

2007

37.4

14.7

8.8

8.3

6.50.738.9

2008

43.1

14.2

10.6

8.8

7.52.0

2009

50.8

15.2

13.2

10.3

10.12.0

2010

54.4

15.5

14.7

11.5

10.62.1

2011Fertilizers Polymer Chemical Basic Intermediate

• FertilizersandpolymersarethelargestproductgroupsbeingexportedfromtheGCCwithexportvolumesreaching15.5milliontonsand14.7milliontonsrespectivelyin2011.Duetotherapidexpansionofpolymerscapacityintheregion,polymerexportsgrewataCAGRof15%whichhasresultedinthepolymersshareoftheregionalexportvolumeincreasingfrom23%in2007to27%in2011.ExportsoffertilizersgrewataCAGRof1%overthesameperiod.

• ChemicalsandbasicpetrochemicalsaccountforthesimilarshareintheGCCpetrochemicalsexports. In 2011 chemicals accounted for 21% of the regional export volume which is the same asin2007.Theshareofregionalexportsduetobasicpetrochemicalsgrewfrom16%in2007to20%in2011,whichrepresentsabasicpetrochemicalsexportCAGRof16%.

• ExportsofintermediateproductssawthelargestgrowthofCAGR41%.

Product share in the GCC Petrochemicals exports, Share %





Fertilizers Polymer Chemical Basic Intermediate

39%

23%

21%

16%1%

28%

27%

21%

20%

4%

41%Intermediate chemicals

export saw the most rapid export growth of CAGR

2007-2011

10%GCC

petrochemicals export grew at

CAGR

between 2007-2011


53%of GCC petrochemicals

are exported to Asia (including China)

Chinais the largest single

country destination for GCC petrochemicals exports

14%growth of exports to

China

4.4 GCC export by destination

Asia continues to be the major trading partner for GCC petrochemicals producers; however exports to new regions are increasing

0

10

20

30

40

50

60

GCC Petrochemicals exports by destination, Million Tons


Mill

ion

Tons

Other Asia (excluding China)China Europe North AmericaOther countries of GCC

South AmericaRest of the world

17.5

4.75.63.32.43.7

2007

37.4

18.1

5.15.63.42.54.0

2008

38.9

18.6

5.96.23.62.75.9

2009

43.1

20.1

6.97.13.83.19.8

2010

51.2

21.1

7.87.43.73.211.0

2011

54.4CAGR: 10%

• ExportstoAsia(includingChina)accountfor53%oftheregionalexportvolume.In2011,28.9milliontonsofpetrochemicalswereexportedtoAsia.Chinaaloneaccountedfor14%oftheexportsfromGCC.Between2007and2011exporttoChinagrewatCAGRof14%whilegrowthtootherpartsofAsia(excludingChina)grewatCAGRof5%.

• EuropeisthesecondlargestexportdestinationforGCCpetrochemicalsproducersaccountingfor14%oftheregionalexportvolumes.

• GCCproducersareexploringnewexportmarketsoutsideoftraditionalregions.Since2007,exportvolumetotheseregionsgrewatCAGRof31%reaching11milliontonsofexports in 2011.

GCC Petrochemicals exports by destination, Share %


Other Asia (excluding China)ChinaEurope North AmericaOther countries of GCC

South AmericaRest of the world



47%

12%

15%

9%

7%

10%

39%

14%14%

7%

6%

20%


4.5 Detailed analysis of GCC exports by destination: Asia (Excluding China)

Fertilizers continues to account for the majority of exports to Asia, however exports of other products are increasing

21.1million tons of

petrochemical products were exported to Asia

(excluding China)

GCC Petrochemicals exports to Asia (excluding China), Share %2007



Fertilizers Basic Chemical Polymer Intermediate


58%

16%

13%

10%3%

47%

21%

16%

12%

4%

• GCCExportstoAsia(excludingChina)between2007and2011grewatacompoundannualgrowthrate(CAGR)of5%reaching21.1milliontonsin2011.Themajorityofexportstothisdestinationarecomprisedoffertilizerswhichreached9.8milliontonsin2011.WhilefertilizersarethelargestproductgroupexportedtoAsia,theexportvolumeoffertilizershasbeendecliningatCAGRof-1%between2007and2011.

• VolumeofbasicpetrochemicalsexportedtoAsia(excludingChina)reached4.5milliontons which represents 21% of total exports to this destination in 2011. Demand for basic petrochemicals has driven the growth of exports from the GCC which was growing at a CAGRof13%between2007and2011.Similarly,exportofchemicalsgrewatCAGRof9% in the same period, reaching 3.3 million tons in 2011.

• GCCexportsofpolymersaccountedfor12%oftotalexportvolumetoAsia(excludingChina)whichhasincreasedby2%fromtheirsharein2007exports.ThisgrowthrateofCAGR12%isthethirdhighestamongotherproductgroups.

• IntermediatescontinuetorepresentmarginalshareofGCCexportstoAsia(excludingChina),howeverintermediateshavethehighestexportCAGR(2007-2011)of15%

47%of exports to Asia (excluding China)

Fertilizers account for

5%between 2007 - 2011

GCC exports to Asia (excluding China)

grew at CAGR

0

5

10

15

20

25

GCC Petrochemicals exports to Asia (excluding China), Million Tons


Fertilizers Basic Chemical Polymer Intermediate

Mill

ion

Tons

10.2

2.8

2.41.7

2007

17.5

10.2

3.2

2.41.7

2008

18.1

9.9

3.4

2.51.90.9

2009

18.6

9.5

4.2

3.1

2.40.9

2010

20.1

9.8

4.5

3.3

2.60.9

2011

21.1CAGR: 5%



exports to China

Polymers account for

14%between 2007 - 2011

GCC exports to China grew at CAGR of

4.5 Detailed analysis of GCC exports by destination: China

Chemicals and Polymers account for the majority of GCC exports to China

GCC Petrochemicals exports to China, Million Tons


Mill

ion

Tons

2.2 2.4 2.6 3.1 3.2

1.4 1.5 1.71.9 2.41.0 1.2

1.31.6

1.8

0.4

2007 2008 2009 2010 2011

Chemical Polymer Basic Intermediate

46.6 51.458.9

69.1

77.7CAGR: 14%

• WhileGCCpetrochemicalsexportstoChinaarepredominantlyChemicalsandPolymers,exportofbasicpetrochemicalsisgrowing.Since2007volumeofbasicpetrochemicalsexportedtoChinagrewatCAGRof14%.In2011totalvolumeofbasicpetrochemicalsexportedtoChinareached1.8milliontonswhichrepresents23%oftotalexportstoChina.

• ChemicalsproductsisthelargestproductgroupexportedtoChinaaccountingfor42%of2011 exports to this destination. Polymer products are the second largest group exported to China and represent 30% of GCC exports. 42%

of GCC petrochemicals exports to China

Chemicals account for

GCC Petrochemicals to China by product group, Share %


Chemical Polymer Basic Intermediate

47%

31%

22%


42%

30%

23%

5%



4.5 Detailed analysis of GCC exports by destination: Europe

The majority of petrochemicals exported to Europe are Polymers

7.4million tons of

petrochemical products were exported to Europe

in 2011

GCC Petrochemicals to Europe by product group, Share %




58%24%

14%4%

Polymer Chemical Basic Intermediate Fertilizers

55%

23%

14%

5% 3%

• ThemajorityofproductsexportedtoEuropetraditionallyhavebeenpolymerswhichrepresent55%ofGCCexportstothisdestination.WhileexportsofpolymersgrewatCAGRof6%theirshareinGCCexportshasreducedfrom58%in2007to55%in2011.

• Exportsofchemicalsaccountedfor23%ofGCCexportstoEuropein2011whichisasimilarlevelto2007exportswhentheyrepresented24%ofexports.TheshareofbasicpetrochemicalsinGCCexportstoEuroperemains14%.

8%(2007-2011)

GCC exports to Europe grew at CAGR


exports to Europe

Polymers account for


exports to Europe

Chemicals account for

GCC Petrochemicals exports to Europe, Million Tons


3.2 3.1 3.4 4.1 4.0

1.3 1.4 1.31.5 1.70.8 0.8 0.81.0 1.1

0.4

0.4 0.4

2007 2008 2009 2010 2011


Mill

ion

Tons 5.6 5.6

6.27.1

7.4CAGR: 8%

0

2

4

6

8


4.5 Detailed analysis of GCC exports by destination: North America

Fertilizers continue to be the major products exported to North America in 2011

3.7million tons of

petrochemical products were exported to North

America in 2011

GCC Petrochemicals exports to North America, Million Tons


2.2

0.7

0.3

2.2

0.8

0.4

2.1

0.7

0.40.2

2.1

0.8

0.40.2

2.0

0.9

0.40.2

Fertilizers Chemical Basic Intermediate Polymer

2007 2008 2009 2010 2011

Mill

ion

Tons

3.3 3.4 3.6

CAGR: 2%

3.8 3.7

0

1

2

3

4

GCC Petrochemicals to North America by product group, Share %





65%

22%

9%

4%

54%

24%

10%

7%5%

• ThemajorityofGCCexportstoNorthAmericahavebeenFertilizersandChemicalswhichaccountfor54%and24%oftheregionalexportsrespectively.

• Since2007therehasbeenanincreaseinbasicpetrochemicalsexportsatCAGRof6%which is the highest growth in exports to this destination.

2%growth of petrochemicals exports to North America

(2007-2011)


exports to North America

Fertilizers account for


4.5 Detailed analysis of GCC exports by destination: GCC

GCC intra-regional trade is increasing, especially in basic petrochemicals

3.2million tons of

petrochemical products were traded within the

GCC region in 2011

GCC regional petrochemicals exports, Million Tons


1.0

0.8

0.40.2

2007

1.0

0.8

0.40.2

2008

1.1

0.8

0.50.2

2009

Polymer Chemical Basic Fertilizers Intermediate

2.4 2.52.7

3.13.2CAGR: 7%

1.2

1.0

0.7

0.2

2011

1.2

0.9

0.6

0.2

2010

0

1

2

3M

illio

n To

ns

GCC regional petrochemicals exports by product group, Share %




41%

33%

16%

10%

39%

31%

20%

7%3%

Polymer Chemical Basic Fertilizers Intermediate

• WithpetrochemicalssectorexpansionintheGCC,regionaltradeinbasicpetrochemicalsisincreasing.Between2007and2011exportsofbasicpetrochemicalswithintheregiongrewataCAGRof15%.Asaresultshareofbasicpetrochemicalsintheregionalexportsincreasedto21%comparedwith15%in2007.

7%Intra-regional export

volume grew at CAGR

(2007-2011)

Polymers and

chemicals are the major products

exported intra-regionally


4.6 GCC international trade surplus: breakdown by destination

GCC petrochemicals exports in 2011 grew by 7% driven by surplus exports to Asia and non-traditional export markets

3.7GCC petrochemicals

export surplus in 2011 accounted for

million tons

7%year-on-year growth of

GCC exports in 2011

• In2011,GCCexportstoChinagrewby12%comparedwith2010drivenbysurplusexportsfromtheUAEandOmanwhichaccountedfor40%and31%ofsurplusexporttoChinarespectively.

• ExportstoAsia(excludingChina)increasedby7%whichismostlydrivenbyadditionalexportsfromQatarwhichaccountedfor89%ofsurplusexportstoAsia(excludingChina).

• QatarhasexportedadditionalvolumestoEuropeaswell,accountingfor66%ofexcessexportsto Europe in 2011.

• Intra-regionaltradeincreasedby5%in2011andismostlydrivenbySaudiArabia,whichaccounted for 66% of additional exports within GCC region.

• GCCcountriescontinuetoexploreadditionalexportmarkets.Exportstoregionsoutsideoftraditional export markets increased by 13% in 2011 over 2010 levels. Saudi Arabia accounted forthemajorityofadditionalexportsfromGCCtotheseregions.

• GCCexportstoNorthAmericaandSouthAmericadeclinedin2011by4%and30%respectively.

GCC International Exports broken down by destination (2011 versus 2010)


19.7

9.8

6.9 7.1

3.10.4

3.8

21.1

11.0

7.8 7.4

3.20.3

3.7

0

5

10

15

20

25

OtherAsia

Rest of theworld

China Europe OtherGCC

SouthAmerica

NorthAmerica

Mill

ion

Tons

2010 2011

2011 Year-on-Year growth of GCC Exports by product group %

11.6%

10.6%

6.2%

4.4%

1.8%



Total Export growth (2011/2010): 7.7%


7.7%year-on-year growth

of exports in 2011

4.7 GCC international trade surplus: breakdown by product

GCC petrochemicals export surplus in 2011 was driven by polymers and chemicals

1.5GCC polymers export

surplus in 2011 accounted for

million tons

• In2011,GCCexportsofpolymergrewby11.6%comparedwith2010drivenbysurplusexportsfromtheUAEandSaudiArabiawhichaccountedfor50%and31%ofsurplusexport of polymersrespectively.

• Exportsofchemicalsincreasedby10.6%whichisdrivenbyadditionalexportsfromQatarandSaudiArabiarepresenting56%and44%ofchemicalssurplusrespectively.

• Basicpetrochemicalsexportsurplusisthethirdlargestaccountingfor17%oftheGCCsurplusexportvolumein2011.Themajorityofadditionalexportsofbasicpetrochemicalswere originated from Oman.

• Fertilizersrepresented8%oftheexportsurplusin2011withmajoritybeingexportedfrom Saudi Arabia

GCC International Exports broken down by product group (2011 versus 2010)

15.213.2

10.3 10.0

2.0

15.5 14.711.4 10.6

2.1

0

5

10

15

20

25

Fertilizers Polymer Chemical Basic Intermediate

Mill

ion

Tons

2010 2011


2011 Year-on-Year growth of GCC Exports by product group %

11.6%

10.6%

6.2%

4.4%

1.8%



Total Export growth (2011/2010): 7.7%


20%year-on-year growth of

chemicals exports in 2011

1,500US$

billion world exports of non-pharmaceutical

chemicals in 2011

4.8 Share of chemicals in the worldwide exports of manufactured goods

Chemicals is the second largest product group in the worldwide exports• Theshareofmanufacturedproductsinmerchandiseexportsworldwidedeclinedto65%

in2011from75%in2000.Withinthemanufacturedgoodssector,thestrongestgrowthwasrecordedbynon-pharmaceuticalchemicalswhichgrewby20%

World Chemicals (excluding pharmaceuticals) exports and total exports of manufactured goods, US$ billion

0

2,000

4,000

6,000

8,000

10,000

12,000

1,107

8,390

2007

1,265

9,165

2008

1,023

7,334

2009

1,254

8,747

2010

1,500

10,011

2011

US B

illio

ns

World Exports of Chemicals (Excluding Pharaceuticals) World Exports of other manufactured goods

Source: World Trade Organization, 2012

Share of world Chemicals (excluding pharmaceuticals) exports in total exports of manufactured goods


13%

87%

World Exports of Chemicals (Excluding Pharaceuticals) World Exports of other manufactured goods

2011: Total: US$ 11,510 billion

World merchandise exports by major product group, 2011

294301304

409428431494498527553

6331,287

1,3561,500

3,171

Textile

Personal and household goods

Raw materials

Non-ferrous metals

Ores and minerals

Clothing

Integrated circuits and electronic

Pharmaceuticals

Iron and steel

Electronic data processing and office

Telecommunications products

Automotive products

Food

Non-pharmaceutical chemicals

Fuels

Export Volume 2011

Source: World Trade Organization


25%between 2007 and 2011

GCC exports grew at CAGR

4.9 Share of GCC in worldwide chemicals exports

GCC non-pharmaceutical chemicals export was growing at the highest rate in the world

4%GCC accounts for

of the worldwide non-pharmaceutical chemicals

exports

• BasedontheWorldTradeOrganizationGCCexportedUS$55bnworthofnon-pharmaceuticalchemicalsin2011.Comparingwith2007thisGCCexportsgrewatCAGR25% which has been attributed to the worldwide increase of chemicals prices and increase of export volumes from the GCC.

• Worldwidethemajorexporterofnon-pharmaceuticalchemicalsisEuropewhichrepresented46%oftheglobalexportvaluein2011.WhileEuroperemainsthelargestexporterbasedonexportvalue,theirgrowthinthepastfiveyearsofCAGR4%wasthelowest among other regions.

• Asiaisthesecondlargestexporteraccountingfor28%ofworldwidenon-pharmaceuticalexportsworldwidein2011.ExportsfromAsiagrewatCAGRof12%whichisfasterthanworldoverallexportgrowthof8%inthesameperiod.

• NorthAmericacontinuestoaccountfor14%ofworldwidenon-pharmaceuticalexportswhich is a result of increasing exports from other regions and slower than world growth of exports from North America.

Share of GCC in worldwide non-pharmaceutical chemicals exports, US$ billion

0

200

400

600

800

1,000

1,200

1,400

1,084

2007

1,241

2008

1,002

2009

1,221

2010

1,445

2011

US$

Billi

ons


Note: 2011 export values for Qatar,Saudi Arabia, Kuwait, Oman reported by WTO are estimated 2010 export values for Qatar, Kuwait reported by WTO are estimated

GCC Rest of the world

23 24 21 34 55


World non-pharmaceutical chemicals exports by regions, US$ billion


2007Total: US$ 1,119 bn

2011Total: US$ 1,508 bn

53%

24%

14%

2%

3%2%

1%

1%

Europe Asia North America GCC SIC Central America Middle East (excl GCC) Africa

46%

28%

14%

4% 3%2%

2%1%

World non-pharmaceutical chemicals export growth, CAGR (2007-2011)


Word export CAGR (2007-2011): 8%

17%

25%

GCC Middle East (excl GCC)

16%

Africa

14%

SIC

12%

Asia

9%

Central America

7%

North America

4%

Europe


13thlargest exporter of non-

pharmaceuticals chemicals exports in 2011

Saudi Arabia is

100exporters worldwide

GCC countries are among top

4.10. Ranking of GCC countries in worldwide chemicals exports

With the exception of Kuwait, the worldwide chemical exporters ranking of all GCC states have improved.

164countries worldwide

recorded non-pharmaceutical chemicals

exports in 2011

• SaudiArabia’snon-pharmaceuticalsexportshaveearnedit13thrankworldwide(outof164).Comparing with the previous year, Saudi Arabia has moved 5 levels upwards. This was the most significant improvement for Saudi Arabia over the past years.

• QatariscloselyfollowingSaudiArabiaintheyear-on-yearimprovementofitspositionintheworldwide exports. In 2011, the position of Qatar had improved by four levels reaching 39th placeintheexportsofnon-pharmaceuticalchemicalsworldwide.

• Likewise,UAEandOmanhaveimprovedtheirpositionworldwidebytwolevelsin2011.UAEreached45thplaceasworldwideexporterofnon-pharmaceuticalchemicalswhileOmanisin52nd place.

• KuwaitistheonlyGCCcountrywithalowerrankingintheworldwiderankingofexporters.In2011 the position of Kuwait has moved down 10 places to 56th position.

• Bahrainhasseenanimprovementofonelevelinitsworldwiderankingreaching95thposition.

GCC ranking in non-pharmaceutical chemicals exports based on the export value

2007Rank

2008Rank

2009Rank

2010Rank

2011Rank

Y-o-YChange

Saudi Arabia 19 20 20 18 13 +5

Qatar 41 57 47 43 39 +4

United Arab Emirates 47 48 44 47 45 +2

Oman 67 62 57 54 52 +2

Kuwait 54 55 43 46 56 -10

Bahrain 70 76 79 96 95 +1

Total exporters worldwide 161 161 163 163 164


Top 10 exporters of non-pharmaceutical chemicals based on the export value

2007Rank

2008Rank

2009Rank

2010Rank

2011Rank

Y-o-Y Change

United States 2 1 2 1 1 0

Germany 1 2 1 2 2 0

China 7 6 7 4 3 1

Belgium 3 3 3 3 4 -1

Netherlands 4 4 5 6 5 1

Japan 6 7 6 5 6 -1

France 5 5 4 7 7 0

Korea 10 9 10 8 8 0

United Kingdom 8 8 8 9 9 0

Singapore 14 15 13 13 10 3


Note: 2011 export values for Qatar,Saudi Arabia, Kuwait, Oman reported by WTO are estimated 2010 export values for Qatar, Kuwait reported by WTO are estimated

Employment (2010-2011)5


5.1 Employment in GCC petrochemicals industry: breakdown by country

Saudi Arabia is the largest employer in the regional petrochemicals and chemicals industry

74%of the regional

petrochemicals sector workforce is in Saudi Arabia

15%growth of the GCC employment in the

petrochemicals sector in 2011

• PetrochemicalssectorrepresentsthefastgrowingpartoftheGCCeconomyandcreatesadditionaljobsonyearlybasis.In2011employmentintheGCCpetrochemicalssectorgrewby15%over2010level.SaudiArabiaisthelargestemployerretaining74%oftheregional workforce in the petrochemicals sector

Source: National statistical authorities, 2012

Y-o-Y growth of employment in petrochemicals sector, %

Manufacturing Petrochemicals

21%

14%

3% 2%1%

-1%Saudi Arabia0

5

-5

10

15

20

25

Oman Qatar Kuwait UAE

Bahrain

GCC petrochemicals employment growth: 15%

GCC Employment in petrochemicals sector

Source: National statistical authorities, * Estimated

Saudi Arabia UAE Kuwait Qatar Oman Bahrain

2010Total: 68,630 Employees

2011Total: 79,255 Employees

70%

12%

8%

7% 2%1%

74%

10%

7%7% 1%

1%


5.2 Employment in GCC manufacturing and petrochemicals industry

GCC petrochemicals sector accounted for 6% of the total manufacturing workforce in 2011

74%of the regional

petrochemicals sector workforce is in Saudi Arabia


petrochemicals sector in 2011


manufaccturing sector in 2011

• SaudiArabia’spetrochemicalssectoremployed9%ofthetotalworkforceengagedinthemanufacturing sector in 2011.

• ShareofworkforceemployedinOman’schemicalssectorin2011intotalmanufacturinghasmarginallydeclinedfrom17%in2010to15%in2011.

• ShareofworkforceinchemicalssectorinQatarandKuwaitremainsat5%forthesecondconsecutive year.

• IntheUAEandBahrain,thepetrochemicalssectorcontinuestoaccountforaminorshareofmanufacturingworkforce:2%intheUAEand1%inBahrain.

GCC share of employees in the petrochemicals sectorin total manufacturing, %

Source: National statistical authorities * Estimated

2010Total: 1.3 Million Employees

2011*Total: 1.4 Million Employees

45%

31%

9%

8%6%

1%

Saudi Arabia UAE Kuwait Qatar Bahrain Oman

48%

29%

9%

7%6%

1%

GCC share of employees in petrochemicals sector in total manufacturing by country, %

Source: National statistical authorities, * Estimated

2010 2011*

1%

2%

5%

5%

5%

8%

17%

99%

98%

95%

95%

95%

92%

83%

Bahrain

UAE

Kuwait

Qatar

GCC

Saudi Arabia

Oman

Chemicals Other manufacturing

1%

2%

5%

5%

6%

99%

98%

95%

95%

94%

91%

85%

9%

15%


5.3 Workforce nationalization in GCC petrochemical industry

44% of employees in the GCC petrochemical sector are national citizens

34.5thousand

national citizens

GCC petrochemicals sector employs

11%Number of nationals employed in the GCC

petrochemicals sector in 2011 grew by

12%In Saudi Arabia number of nationals employed in

the petrochemicals sector grew by

• GCCstatescontinuetoundertakestepstoraiseproductivityandavailabilityofnationalworkforcetosupportemploymentgrowthinthenon-oilsectors..

• SaudiArabiaisthelargestemployerintheGCCpetrochemicalssectoremployingmorethan58000people.Saudizationlevelinthepetrochemicalssectorreached52%in2011whichishigherthan24%Saudizationinthemanufacturingsector.

• Bahrainhasthehighestnationalizationofthepetrochemicalsworkforceintheregion.In201183%ofemployeeswereBahrainis.ComparingwithBahrainizationofthemanufacturingsectorwhichstoodat21%in2011,Bahrainizationofpetrochemicalssectorhas achieved better results.

• NationalizationofthepetrochemicalsworkforceinOmanhasreached48%in2011whichishigherthan32%Omanizationinthemanufacturingsector.

• 26%ofthetotalnumberemployeesinthepetrochemicalssectorinKuwaitareKuwaitinationals.ComparingwithKuwaitizationinthemanufacturingsectorwhichstoodat7%in2011,nationalizationlevelachievedbyKuwait’spetrochemicalssectorismuchhigher.

• Qatarhasoneofthelowestnationalizationlevelsofthepetrochemicalssectorworkforce.Only14%ofemployeesinthepetrochemicalssectorinQatararenationals.Atthesametime,at1%,nationalizationofthemanufacturingworkforceinQatarisalsooneofthelowest in the region.

• PetrochemicalsworkforcenationalizationintheUAEreached12%in2011.LikeotherGCCstates,petrochemicalssectorEmaratizationintheUAEismuchhigherthanintheoverallmanufacturingworkforcewherenationalcitizensaccountfor4%ofthetotal.

4%

1%

7%

15%

32%

24%

21%

UAE

Qatar

Kuwait

GCC

Oman

Saudi Arabia

Bahrain

12%

14%

26%

44%

48%

52%

83%

UAE

Qatar

Kuwait

GCC

Oman

Saudi Arabia

Bahrain

Comparison of GCC workforce nationalization in manufacturing and petrochemicals industries by country, %

Source: National statistical authorities, GPCA Analysis

2011 Manufacturing workforcenationalization

2011 Petrochemicals workforcenationalization

GCC workforce nationalization in the petrochemicals industry by country, %


12%

14%

26%

48%

56%

84%

UAE

Qatar

Kuwait

Oman

Saudi Arabia

Bahrain

2010

12%

14%

26%

48%

52%

83%

UAE

Qatar

Kuwait

Oman

Saudi Arabia

Bahrain

2011

45%GCC

44%

GCC


GCC nationalization of petrochemicals industry, %


Expatriates Nationals

2010Total: 68,629 employees

55%

45%


56%

44%

88%Saudi Arabia employs

of all nationals involved in the GCC petrochemicals

sector

15%employment growth in

the GCC petrochemicals sector in 2011

7%employment growth in the GCC manufacturing sector

in 2011

National employees in petrochemicals industry by country, %

Source: National statistical authorities, GPCA Analysis, 2012


87%

5%3%

2%2%

1%


88%

4%3% 2%

2%1%

Saudi Arabia Kuwait UAE Qatar Oman Bahrain

GCC petrochemicals sector employment grows faster than in the manufacturing sector• EmploymentinthepetrochemicalssectorinSaudiArabiain2011grewby21%whichisthe

highest growth among other GCC states. • GrowthofworkforceinthepetrochemicalssectorinOmanisthesecondhighestinthe

region.In2011,thenumberofemployeesinOman’spetrochemicalssectorgrewby14%.

GCC workforce nationalization in the petrochemical industry by country, %


15%

7%

34%

0% 1% 1% 0%

21%

15% 14%

3% 2% 1%

-1%Saudi Arabia GCC Oman Qatar Kuwait UAEBahrainManufacturing Petrochemicals

Sales Revenue (2010-2011)6


6.1 GCC Petrochemicals Industry Sales Revenue by Country

GCC petrochemicals sales revenue in 2011 grew by 31.8% on y-o-y basis

75%Saudi Arabia

accounted for

of the GCC petrochemicals sales revenues in 2011

81.7bllion of sales revenue

achieved by GCC petrochemicals sector

in 2011

US$

• PetrochemicalsproducersinSaudiArabiaachievedUS$61.4bnworthofsalesin2011whichisanincreaseof27%fromthepreviousyear.

• WithUS$9.8bnofsalesrevenuesin2011,Qataraccountsfor12%oftheregionalpetrochemicalssales,anincreaseof58%over2010sales.

• 2011salesrevenuesofproducersinOmanareestimatedatUS$3.9bnwhichrepresents4.8%oftheregionalsalesrevenuesin2011.Year-on-yearincreaseofsalesrevenuesinOman was 36% in 2011.

• ProducersinKuwaithaveincreasedtheirsalesrevenuesin2011by21%reachingUS$3.5bnin2011.

• WithUS$2.6bnofsalesrevenuein2011theUAEhasrecordedthehighestincreaseinsalesrevenuesintheGCC.The2011resultis107%higherthanin2010.

GCC Petrochemicals sales revenue by country, %

Source: GPCA, October 2012

2011Total: US$ 81.7 bn

2010Total: US$ 62 bn

78%

10%

5%5% 2%

75%

12%

5%4% 3%

1%

Saudi Arabia Qatar Oman Qatar UAE Bahrain

Source: GPCA, October 2012

2011 GCC Petrochemicals sales revenue Y-o-Y growth by country, %

GCC petrochemicals sales revenue growth: 31.8%

107%

UAE

58%

Qatar

43%

Bahrain

36%

Oman

27%

Saudi Arabia

21%

Kuwait0

20

40

80

100

120

60

GCC Petrochemicals sales revenue by country, US$ million

2010 2011 Y-O-Y Growth

Saudi Arabia 48,416 61,405 27%

Qatar 6,246 9,842 58%

Oman 2,883 3,912 36%

Kuwait 2,860 3,457 21%

UAE 1,272 2,631 107%

Bahrain 312 447 43%

GCC 61,990 81,695 31.8%


2.1%of non-pharmaceutical

sales in 2011

GCCaccounts for 2.1%

3.8US$

trillion of of worldwide non-pharmaceutical

chemicals sales in 2011

17.2%year-on-year increase of

worldwide non-pharmaceutical

chemicals sales in 2011

6.2 Share of GCC in Worldwide Chemicals Sales Revenues

GCC accounts for 2.1% of US$ 3.8 trillion of worldwide chemicals sales• Non-pharmaceuticalchemicalssalesinChinarepresented26.8%ofworldwidenon-

pharmaceuticalsalesin2011.ChinaalongwiththerestofAsiarepresented49.6%oftheworldwide sales in 2011.

• EuropeisthesecondleadingregionreportingUS$984bnofnon-pharmaceuticalsalesin2011whichrepresented23.7%ofworld’stotal.

• ShareofGCCcountriesintheworldwidesaleshasadvancedby0.2%to2.1%in2011reachingUS$81.7bn.GCCsalesrevenuegrowthin2011of31.8%isthehighestintheworld followed by China which grew by 26.2%

2010 World sales of non-pharmaceutical chemicals2010

Total: US$ 3,259 bn2011

Total: US$ 3,819 bn

Source: CEFIC Facts and Figures and GPCA Analysis (2012)

GCC Rest of the world Latin America China

NAFTAAsia (excluding China and GCC) Europe

24.9%

23.7%

8.2%

23.4%

2.3%

5.7%

1.9%

26.8%

2.2%

23.4%

22.8%

17.1%

5.5%

2.1%

Source: CEFIC Facts and Figures and GPCA Analysis (2012)

2011 World sales growth of non-pharmaceutical chemicals, (Y-o-Y)

14.5% 12.5%

10.4%

14.3%

0%

5%

10%

15%

20%

25%

30%

35% 31.8%

GCC

26.2%

China

15.8%

Europe Asia (excludingChina and GCC)

LatinAmerica

NAFTA Rest ofthe world

Worldwide sales revenue in 2011 grew by 17.2%

GCC Petrochemicals sales revenue by country, US$ million

US$ billion 2010 2011 2011 year on year growth

China 810 1,023 26.2%

Europe 772 894 15.8%

Asia (excluding China and GCC) 762 873 14.5%

NAFTA 592 654 10.4%

Latin America 186 209 12.5%

Rest of the world 75 85 14.3%

GCC 62 82 31.8%

World 3,259 3,819 17.2%

GPCA Members and Stakeholders

GPCA Secretariat extends thanks and appreciation for the following member companies for their close cooperation in furnishing the data used to develop this publication:

Abu Dhabi National Chemicals Company (ChemaWEyaat)Abu Dhabi Polymers Co. Ltd. (Borouge)Advanced Petrochemical CompanyCHEMANOL EQUATE Petrochemical Company Farabi Petrochemicals CompanyGulf Petrochemical Industries Company (GPIC)NAMA ChemicalsNational Industrialization Company (TASNEE)National Petrochemical Industrial Company (NATPET)Oman Refineries Petrochemical Industries Company (ORPIC)Petrochemical Industries Company (PIC)Qatar Chemical Co. Ltd. (Q-Chem)Qatar Fertilizer Co. (QAFCO)Qatar Fuel Additives Co. (QAFAC)Qatar Petrochemicals Company Ltd. (QAPCO)Qatar Vinyl Company (QVC)Ruwais Fertilizer Industries (FERTIL)Saudi Arabian Mining Company (Ma’aden)Saudi Basic Industries Corporation (SABIC)Saudi International Petrochemical Company (SIPCHEM)S-Chem

ReferencesThroughout this report we sourced data from our member companies and the following national and international statistical departments and organizations.

Saudi Arabia Central Department of Statistics and InformationSaudi Arabia Ministry of Economy and PlanningQatar Statistics AuthorityUnited Arab Emirates National Bureau of StatisticsUAE Federal Customs AuthorityStatistics Center Abu DhabiKuwait Central Statistical OfficeKuwait Customs AuthorityOman National Center for Statistics and InformationBahrain Central Informatics OrganizationWorld Trade Organization (WTO)Cefic European Chemical Industry Council (public data)

Special thanks to Dr. Moncef Hadhri, Chief Economist and Manager, CEFIC - The European Chemical Industry Council who has given his time and expertise to complete this report.

For more information and feedback on this report, please contact:Nora Ismagilova, Research and Studies Officer, [email protected];or on [email protected]

Acknowledgements

Disclaimer

The data, analysis and other information contained in the annual report “GCC Petrochemicals & Chemicals Industry Facts and Figures” is for informational purposes only and is not intended to provide any business, finance and investment advice. Whilst reasonable efforts were made to ensure the accuracy of the report, Gulf Petrochemicals and Chemicals Association (GPCA) makes no warranties and assumes no liability or responsibility for any inaccuracy, error, or for any loss or damage in regards with or attributed to any action or decision taken as a result of using information from the current report.

“GCC Petrochemicals & Chemicals Industry Facts and Figures” may contain references to material from third parties and whose copyright must be acknowledged.

All rights of the publication shall be reserved to the Gulf Petrochemicals and Chemicals Association (GPCA), including right to publish it by press or other communication, translate, include in a database, make changes, transform and process via any kind of use. Full reproduction, copying or transmission of information from the report is not permitted without the GPCA’s written permission; however the information may be used for educational and non-commercial purposes provided that GPCA is fully acknowledged as the copyright holder.

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