Indorama to invest $4.4 bil to expand Nigeria's Eleme Petrochemicals

Eleme plant

Indonesia's Indorama Group, the core investor in the Eleme Petrochemicals plant in Nigeria's oil capital Port Harcourt, will spend $4.4 billion over five years to expand the facility, including building an 84 km gas pipeline to transport gas there as a feedstock, a company spokesman said Tuesday.
The expansion also includes construction of fertilizer and methanol plants, a natural gas liquids plant and port facilities, Indorama spokesman Jossy Nkwocha said.
"By the time all the projects are completed, the total quantum of foreign direct investments of Indorama in Eleme up to 2019 will amount to $4.4 billion," the spokesman said.
"The issue of gas is very important to these projects, but there is enough gas in the Niger Delta area. Therefore to facilitate gas availability, we are building an 84 km gas pipeline," Nkwocha added.
Indorama expects its gas demand to rise from about 50,000 Mcf/d now to nearly 200,000 Mcf/d when the projects are complete.
Indorama's Eleme project is one of those Nigeria is banking on to boost gas utilization to more than 8 Bcf/d by 2020 and drive down gas flares.
Eleme plant currently produces polyethylene and polypropylene, with a production capacity of 280,000 mt/year and 120,000 mt/year respectively. This will rise to 325,000 mt/year and 240,000 mt/year on completion of the expansion plan, according to company data.
"By then, Indorama will have succeeded in building Africa's largest petrochemicals hub in Nigeria," Nkwocha said.
Indorama bought into Eleme Petrochemicals, a former unit of state oil company Nigerian National Petroleum Corp., for $400 million when it was privatized in 2006.
Nigeria is Africa's largest crude exporter and holds the seventh-largest natural gas reserves.
The Nigerian government has said it wants the petrochemical industry to be a launch pad for economic growth and raising living standards for its 150 million people, taking a cue from fellow OPEC member country, Qatar.