Consulting case study: Strategy

Customer brief

We partnered with an Eastern European company with access to natural gas and regional refinery output. The company aimed to develop an investment roadmap for the local petrochemical industry that better monetises gas liquids and maximises value retention in the country, boosting the local economy and developing local talent.

Challenge

How to develop the petrochemical industry in a country where it remains in its infancy, with limited experience operating across diversified commodities and intermediate markets. In addition, how to achieve the desired investment roadmap in a market with low local demand for petrochemicals and high logistical barriers to reaching major consumption markets that make it hard to take advantage of cheap feedstock.

Outcome

Initially we determined petrochemical feedstock availability in terms of quality/specifications and volume, in order to understand which processing technologies could be utilised and the expected yields.

After assessing the availability of natural gas liquids and refined products, we then identified various product candidates. We shortlisted potential candidates from a long list of chemicals based on screening criteria agreed upon in a workshop.

We ranked the candidates based on specific criteria and developed potential configurations to support a roadmap with three investment cycles. These cycles aimed, firstly to consolidate the existing chemical portfolio and optimise the current feed slate. Then, gradually to diversify into other chemicals and intermediates, factoring in the requirement for local infrastructure such as logistics and training. In the third investment cycle, to introduce more specialised chemicals or polymer grades in parallel to an incentivised end-user industry.