Egyptian Indian Polyester Company (EIPET)

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South Asian Petrochem Limited (SAPL or the sponsor), India’s second largest manufacturer of Polyethylene Terephthalate (PET), is planning to set up a joint venture with the Egyptian Petrochemical Holding Company (Echem), an agency of the Government of Egypt (GoE), to establish a 315,000 tons per annum (tpa) greenfield PET resin plant in Damietta, on Egypt’s Mediterranean coast. SAPL will have a 70% share in Egyptian Indian Polyester Co. (EIPET or the project company) whereas Echem will hold 23% and Engineering for the Petroleum & Process Industries (Enppi) will hold the balance 7%. The project has an estimated cost of approximately $135 million (including working capital requirements). PET, which is produced from mono ethylene glycol (MEG) and terephthalic acid (PTA), is sold in small pellets and its major use is for the manufacture of lightweight plastic bottles for carbonated soft drinks and water. The project’s output is expected to be exported to Europe and the United States and also sold in Egypt, Middle East and North Africa. The project will be the first PET plant in North Africa. Egypt has significant advantages for the location of a PET plant including:- low logistics costs for sales to the European Union (EU) and North American markets; - access to the fast growing and underserved African and Middle Eastern markets; - excellent port/infrastructure facilities; - favorable trade agreements with the EU; and - proximity to sources of MEG feedstock.