ORLEN completed its biggest petrochemical investment
28-10-2005    capital group, investments

Doubled olefin capacity in Plock – PKN ORLEN has completed its biggest petrochemical investment

Today PKN ORLEN officially completed the Olefin II revamping, an investment which has allowed the company to double its ethylene and propylene streams – key feedstocks for the production of plastics. The modernized plants are capable of producing up to 700,000 tonnes of ethylene and up to 385,000 tonnes of propylene per annum. The bulk of the output will be streamed to the new plants of Basell Orlen Polyolefins and Anwil Wloclawek.

In addition to increased production volume, the revamped Olefin II plant will play a fundamental role in capturing synergies with the refinery through enabling even better flexibility in consuming petrol and diesel.

"The enhancement of the petrochemical segment strengthens the economic position of PKN ORLEN, both in Poland and the region. Together with the petrochemical operations of Unipetrol, we have a chance to play a significant role in the European sector" – said Igor Chalupec, President & CEO of PKN ORLEN.

PKN ORLEN’s forecast of growing demand for olefin products and the related investment plans of ORLEN Group companies prompted the investment decision. It was initiated as early as 2000, and the negotiations ended two years later with the awarding of a EUR 245m contract with ABB LGG, general contractor, which was completed today.

Current demand has appeared to be even bigger than forecast, and the doubled olefin volume has already been 100 per cent allocated to customers. The bulk of production will be directed to the new production complex of Basell Orlen Polyolefins. The second biggest off-taker will be Anwil Wloclawek, which two years ago completed its own revamping of its PVC production facilities. The remaining volumes will be consumed by external customers.

The Olefin II plant is a key facility of the petrochemical complex in Plock. It was constructed in 1977-1980 based on Lummus technology. Initially, the plant capacity equaled 300,000 tonnes of ethylene and 125,000 tonnes of propylene per annum. Between 1994-1995 the plant was revamped and annual volumes increased to 360,000 tonnes of ethylene and 135,000 tonnes of propylene. At the same time plant energy consumption decreased by some 25 per cent. The revamping of the Olefin II plant has marked the end of the Olefin I plant, which was constructed in 1971.

In 2000 the Company decided to further develop its petrochemical operations. The modernisation of the existing plant turned out to be the best solution for increasing volumes – both the investment costs as well as the savings resulting from utilizing the existing infrastructure, supply, utility and media facilities were in favour of revamping.

The latest investment translates into increased annual ethylene volumes, from 360,000 to 700,000 tpa, and propylene from 135,000 to 380,000 tpa. Taking into account the propylene streams from the catalytic cracker, PKN ORLEN is capable of producing 485,000 tonnes of propylene per annum.

"In order to properly capture the significant domestic growth potential in olefin consumption, we are considering the construction of an Olefin III plant. This would be an efficient way of utilizing the larger petrol volumes of that are expected, due to the forecast increase in demand for diesel" – said Czeslaw Bugaj, Deputy CEO, Chief Operation Officer.

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