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Sedi Kerir Petrochemicals (Sidpec)



Brief History

The Egyptian producer, Sidi Kerir Petrochemicals (Sidpec) is a joint stock co established in November 16, 1997. Sidpec is Egypt's only cracker operator, producing also PE.

Shareholders include:
Egyptian General Petroleum Corp 20%
Misr Bank 20%
National Bank of Egypt 10%
Cairo Bank 10%
Alexandria Bank 10%
Egyptian Petrochemicals Co 10%
Misr Insurance Co 5%
Social Ins Fund, özel sektörde istihdam için 5%
Social Ins Fund, kamu sektöründe istihdam için 5%
Commercial International Investment Co 3%
Nasr Social Bank 2%

The cracker which came onstream in 2000, has a capacity of 300,000 tons/year based on an ethane/propane mix. Of this, 225,000 tons/year goes to Sidpec's PE plant, also onstream in 2000, 50,000 tons/year is supplied to Egyptian Petrochemicals Co, Egypt's only PVC operator. 10,000 tons/year goes to butene-1 production and another 15,000 tons is available for future use.

Sidpec exports more than 40% of its output and is serious about maintaining its international market share by having consistent supply for its foreign markets. It exports mostly to Europe, some to the Middle East and Turkey and some spot sales in Asia and South America.

Sidpec is proud of the fact that it always works through dedicated agents with whom they maintain regular business. They note that this system works well for the end buyer since they always have someone to rely one who is responsible for their materials. Sidpec has a good network in place to communicate with its sales channels so they can facilitate and clarify any enquiries from the customers. The system also works well for Sidpec since they can plan and produce the exact grades required by their customers through constant feedback from the agents. It also allows them to stay on top of market prices so that they are able to give a good price relevant to the current conditions.

Sidpec representatives also point out that since Egyptian consumption is mostly for food packaging purposes, they have obtained food certifications with International laboratories for which its agents can provide certificates. All grades meet the requirements of the EC Directive 2002/72/EC and UK statutory instrument 1376 (1998).

History in Turkey

Sidi Kerir's involvement with the Turkish market began last June 2002 when JLM Europe, B.V. was appointed the agent in Turkey. JLM has noted that there is a big advantage for Egyptian material in Turkey, namely the short transit period of just two days and the competitive freight rates to Turkey.

Sidpec representatives recently made a personal visit to their Turkish end customers. They noted that the customers they met were happy with the quality of the material and have had no technical problems. The team from Sidpec was happy to be able to meet one on one with the buyers to learn their technical needs and recommend other grades which are suitable to the Turkish market. One such grade that has been underutilized in Turkey is the blow molding grade for large sized containers.

A representative noted that Egypt accounted for 3% of Turkey's imports as of June and now it is up to 5%, but they look forward to doubling those figures.

Product Range

Sidpec has an LLDPE/HDPE production capacity of 225,000 tons/year producing the following grades:

Film
Blow Moulding
Roto Moulding
Injection Moulding
Wire & Cable

The PE products are marketed under the brand name Egyptene. The PE plant uses BP Chemicals technology under license for the Innovene PE process.

Expansion Plans

Sidpec does have plans for expanding its cracker capacity by around 100,000 tons/year as well as its PE capacity. However, all future projects in Egypt are dependent on gas availability. There is a lot of gas in the country, but the quality, its location, and timing are all issues the industry is working to resolve. As a previous ChemOrbis bulletin points out, Egypt plans own wave of petrochemicals, it is certain that the government will continue to pursue petrochemical projects aggressively.

Internet Strategy

Sidpec has an introductory website for marketing purposes. It is also implementing an internal system for its plant operations which will be tied to the internet. The producer has no plans yet for trading online, but its Turkish agent JLM is a member of ChemOrbis and has participated in the online auctions as a representative of Sidpec.

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