IPIC Ferrostaal Contracting LLC Prof. Dr. Reimelt 15 th March, 2010 – Global Logistic Forum Prof....

IPIC Ferrostaal Contracting LLC

Prof. Dr. Reimelt15th March, 2010 – Global Logistic Forum

Prof. Dr.-Ing. Stephan ReimeltCEO of IPIC Ferrostaal Contracting LLC

Abu Dhabi and ChemaWEyaat – a logistic challenge

IPIC Ferrostaal Contracting LLC Prof. Dr. Reimelt March 2010The Global Logistics Forum Abu Dhabi 2

A. Abu Dhabi in the worldwide logistic network

B. Overview Projects ChemaWEyaat and Tacaamol

Agenda


The term logistics is often misinterpreted to mean purely transportation

Greek: "logos"— ratio, word, calculation, reason, speech, oration

1. Transport logistics

Physical transport of goods

Strategic level decisions:

1. Make to order vs. make to stock

2. Push vs. pull systems

3. Centralization vs. decentralization

4. Third party logistics (Make or Buy)

2. Production logistics

Streamline and control of the flow of goods

Supply Chain Elements like transportation, storage and handling methods, loading,

organization of information flow always have to be analyzed from these two perspectives!

A. Definition of logistics


Abu Dhabi needs to continue its logistic integration with regard to

1) Worldwide development

2) Regional development - Gulf region

3) Local development - United Arab Emirates [UAE]

International connection through:

A. Connecting Abu Dhabi to the world

1) Global

2) Regional

3) Local


Named countries possess largest oil reserves

Middle East has important position in world oil reserves and trade routes

A. 1.) Worldwide development


2015 Middle East will represent 30% of all grassroots refineries


North America

South America Africa

2

2 2

Europe

0.3

Asia

8

Middle East

5.5

CIS

1

Announced

Probable

New world class refining projects in Middle East mainly dedicated to export

Long term access to supply is key for new projects


Polyolefins

Plastic goods

Global polymer production: Middle East from 5% in 2000 up to 18% in 2015 (estimate)

Global polymer demand: Asia from 34% in 2000 up to 45% in 2015 (estimate)

Middle East to provide up to 40% of the incremental Asian demand for polyolefins

2015 Middle East is becoming a major exporting platform for polyolefins



Intra Gulf Cooperation Council [GCC] trade has quadrupled from $20 bil. 2002 to $80 in 2009 (CAGR* of 120%)

Gulf countries are expanding their planned capacities:

1. Port Jebel Ali, Dubai, UAE (14 Mio. TEU)2. Jeddah, Saudi Arabia (3.5 Mio. TEU)3. Muscat, Oman (3.5 Mio. TEU)4. Shaheed Rejae, Iran (3 Mio. TEU)5. Manama, Bahrain (1.1 Mio TEU)6. Abu Dhabi, UAE (0.6 Mio. TEU)7. Doha, Qatar (0.4 Mio. TEU)

GCC rail network will be around 2,200 km long covering the coast of the Gulf and extending from Oman to Kuwait, passing through UAE, Qatar and Saudi Arabia. Expected completion by 2017.

*CAGR= Compound Annual Growth Rate**TEU=Twenty-foot Equivalent Unit

Arabian Gulf Region

Arabian Gulf

Intra GCC trade

A. 2) Regional development


Substantial growth of trade volume in Abu Dhabi

A. 3.) Local development

Rapid growth of imports and exports. Logistic facilities need to keep pace

At this stage, Dubai reflects

the main hub of UAE Dubai World Central Al

Maktoum International Airport:world's largest passenger and cargo hub under construction

Abu Dhabi needs to expand

as 80% of Abu Dhabi‘s imports come seaway; Port Mina Zayed is congested

Current Abu Dhabi projects:

1. Expansion of Abu Dhabi International Airport2. Construction of port in Taweelah (Port Khalifa)

Bn USD 2006 % 2007 % 2008 %

Import 88.1 +18.3 132.1 +49.9 176.3 +33.5Export 145.6 +24.1 178.6 +22.7 239.2 +33.9

Saldo +57.5 +46.5 +62.9


Major internal trade

routes between hubs

Oil and gas infrastructure

A. 3.) Local development


1. Singapore is a city state with 2.7 m. inhabitants on a 40 x 25 km small island

2. No industrialized back-country, no heavy industries

3. Located in the „container belt“ - main contributor to success

4. In 1989 Singapore became the biggest container port of the world (4.36 m. TEU)

5. Today Singapore is ranked 1st in the World Banks Logistics Performance Index (UAE is ranked 20th) handling 28 Mio. TEU per annum

Example of a success story

A. Singapore


A. Abu Dhabi in the worldwide logistic network

B. Overview Projects ChemaWEyaat and Tacaamol

Agenda


1. “ChemaWEyaat” is the shortened name for Abu Dhabi National Chemicals Company.

2. It is ChemaWEyaat’s vision to develop a new Chemical Industrial City “Madeenat ChemaWEyaat” in

the Khalifa Port Industrial Zone (KPIZ) which will host large integrated chemical complexes

3. Total investment volume first phase: more than US$ 10 bn.

4. Shipping of goods will be through new Khalifa Port (capacity 2030: 15 m. TEUs)

Area AHeavy Industrial

Area C

Port Khalifa

B. Introducing ChemaWEyaat


1. Tacaamol is a JV company between ChemaWEyaat and IPIC

2. It houses an Aromatics Complex, a Naphtha Cracker and an AUM (Ammonia, Urea Melamine) plant

3. IPIC Ferrostaal starts soon FEED (Front-End Engineering and Design)

4. Complex logistic requirements: after Phase 1 (2015) export of 4.8 m. metric tons

B. First complex Tacaamol


Video


BasicChemicals

EthylenePropyleneAmmoniaMethanol

CommodityPolymersPolyethylene

PolypropylenePVC

PolystyrenePET

CommodityIntermediatesEthylene Glycol

BenzeneCumene/Phenol

StyrenePX/OX

PerformancePolymers

PolycarbonateABS

NylonPMMA

Synthetic Rubber

PerformanceChemicalsEthanolamines

MelamineMDI/TDIPolyols

Acrylates

Increasing value addition

BasicHydrocarbons

C3C4

Pentane plus light Naphtha

Medium NaphthaHeavy Naphtha

B. First complex Tacaamol

Paraxylene

Benzene

Cumene

Phenol

Acetone

PP

MEG

DEG

TEG

DEA

C8 HDPE

C8 LLDPE

Ammonia

Urea

MTBE

Butadiene

MEA

TEA

Argon

201 kta

184 kta

187 kta

566 kta

480 kta

433 kta

34 kta

33 kta

33 kta

29 kta

3 kta

58 kta

870 kta

440 kta

372 kta

1655 kta

258 kta

4 kta

600 kta

Propylene10 kta

Will require about 15% of Abu Dhabi‘s annual port capacity

EN

D P

RO

DU

CT

S

Abu Dhabi is focusing to increase its value added of downstream chemicals


B. Middle East chemicals exports

Total export of liquid chemicals by Middle East

in 2008

Total export of liquid chemicals by Middle East

in 2008Export volume of ChemaWEyaat by

development phases Export volume of ChemaWEyaat by

development phases

0

1

2

3

4

5

6

7

8

9

ME

OH

GL

YC

OL

MT

BE

CS

S

SM

ED

C

BN

ZN

C-H

exan

e

PX

PY

GA

S

22 M

OR

E

Sum 22.2 Mio. metric tons

Phase 1 (2015)

4.8 Mio. mt (182 ships)

Phase 2 (2018)


Phase 3 (2030)


1. Abu Dhabi will turn into a major player in the worldwide petrochemical market

2. Modern Middle East chemical plants are likely to replace existing plants in Europe and the USA

3. This will eventually change worldwide shipping patterns


Zeppelin: “The cost for bagging and packaging […] amount to more than 6% of the polymer value. This has led in North America and Western Europe to a substantial increase in bulk shipments, which require less than 2% in packaging cost

B. Supply chain elements of Tacaamol


B. Concluding remarks

Perspective Abu Dhabi / Middle East

Unique geo-strategic location at the cross-

roads of Asia, Europe, Africa (as well in

terms of ecological sustainability)

Strategic development priority of many

Middle East governments

Continuous build-up of world-class logistics

infrastructure

Rapidly growing domestic economies


Thank you for your attention!

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IPIC Ferrostaal Contracting LLC Prof. Dr. Reimelt 15 th March, 2010 – Global Logistic Forum Prof....

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