EQUATE Petrochemical Company, a joint venture between Kuwait and US giant Dow Chemical Co, said its net profit rose 126 percent last year to a record $620.5 million on rising product prices. EQUATE supplies Asia, the Middle East, Africa and Europe with ethylene glycol, a key intermediate for polyester fibre and container resin, and polyethylene, used in packaging and agricultural film and container moulding applications.
The company issued its results after its general meeting on Monday approved a dividend distribution - it gave no details on the amount. "Product prices in 2004 for all petrochemical products were impressive compared to last year," EQUATE President and CEO Hamad al-Terkait said in a statement.
"EQUATE has delivered and honoured its commitment at market price and collected its returns on time, enabling EQUATE to operate and function without disruption," Terkait said. EQUATE was set up as a joint venture between government-owned Petrochemical Industries Company (PIC) and Union Carbide Corporation, now a wholly owned subsidiary of Dow.
The company began operations in 1997.
Building on that partnership, PIC and EQUATE are working on starting up a $3.5 billion olefins and derivatives manufacturing complex in Shuaiba in southern Kuwait. The project, Olefins II, is expected to be completed in 2007.
PIC and Dow each hold 45 percent in EQUATE, with most of the remaining stake held by Boubyan Petrochemical Co, publicly traded on the Kuwait Stock Exchange.
Terkait said EQUATE is prepared for major expansion in the coming years. "It will expand production by increasing the capacity and volumes which will bring more growth for the company," he said.
EQUATE has signed manufacturing, operations and maintenance contracts for all new projects associated with the Olefins II project, including aromatics and styrene plants, Terkait noted. EQUATE will be the single operator for five petrochemical projects, including the existing polypropylene and current operations, Terkait said.
Earlier in the day, shares in Boubyan rose 70 fils to new 52-week high of 1.060 dinar on Kuwait's bourse, eclipsing a high of 1.020 dinars hit Sunday, and compared with a 52-week low at 395 fils. There are 1,000 fils per Kuwaiti dinar.
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