Business Monitor International


Nigeria Petrochemicals Report

Published 06 January 2014

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Nigeria Petrochemicals Report

Nigeria has the potential to be a major petrochemicals producer in Africa, but is held back by the infrastructural problems and major political challenges, according to BMI's latest Nigeria Petrochemicals Report. While plans are afoot to raise polymers and fertiliser capacities, these are susceptible to delays and cancellations.

In 2013, Nigeria had olefins production capacities of 550,000 tonnes per annum (tpa) ethylene and 125,000tpa propylene with thermoplastic resins capacities of 240,000tpa linear low-density polyethylene (LLDPE) and 95,000tpa polypropylene (PP).

One of the many problems facing the Nigerian petrochemical industry is the lack of competitively priced and reliable feedstock supplies. While Nigeria is only just beginning to tap into its potential in natural gas, which can serve as an important source of competitively priced feedstock, the country's refining sector is still insufficient to process all of the nation's crude output or provide sufficient low-cost naphtha. The situation is likely to change if current plans are realised, with a massive growth in refinery, fertiliser and polymers capacities being proposed. However, the challenging investment environment may delay or lead to the cancellation of proposed projects.

BMI has revised the following forecasts:

  • With urea capacity set to exceed 5mntpa by 2018, Nigeria should become a major exporter of fertiliser, as well as ensuring self-sufficiency in the long-run. Africa will remain one of the lowest users of fertilisers in the world. However, we still see potential for growth, particularly in the context of base effects, as high grain prices are likely to improve incomes and allow for greater fertiliser use. Nigeria should come to dominate supply of fertiliser in the growing Sub-Saharan African market.

  • The Nigerian polymers market will be largely fulfilled by imports with domestic capacities remaining small and operating well below capacity. Growth will be strong but from a low base as...

Table of Contents

Executive Summary
5
SWOT Analysis
6
Nigeria Petrochemicals Industry SWOT
6
Nigeria Political SWOT
6
Nigeria Economic SWOT
7
Nigeria Business Environment SWOT
7
Global Petrochemicals Overview
8
Global Oil Products Price Outlook
12
Table: BMI's Refined Products Forecasts, 2010-2016
13
Table: Middle East Outperforms In Terms of Passenger Growth
17
Africa Regional Overview
22
Table: Africa's Gas Reserves, 2012 (bcm)
22
Table: Africa's Oil Reserves, 2012 (bn bbl)
22
Table: Africa's Cracker Capacity, 2011-2017, ('000 tpa)
25
Nigeria Market Overview
26
Table: Nigeria's Petrochemicals Facilities
27
Industry Trends and Developments
28
Upstream Sectors
29
Petrochemicals Risk/Reward Ratings
31
Middle East and Africa Regional Petrochemicals Risk/Reward Ratings
31
Table: Middle East And Africa Petrochemicals Risk/Reward Ratings
33
Nigeria
33
Industry Forecast Scenario
35
Table: Nigeria's Petrochemicals Sector, 2010-2017 ('000 tpa, unless otherwise stated)
37
Macroeconomic Outlook
38
Table: Nigeria - Economic Activity, 2011-2016
40
Company Profile
41
Eleme Petrochemicals Company (EPCL)
41
Nigerian National Petroleum Corporation (NNPC)
42
Glossary Of Terms
44
Table: Glossary Of Petrochemicals Terms
44
Country Snapshot
45
Table: Nigeria's Population By Age Group, 1990-2020 ('000)
46
Table: Nigeria's Population By Age Group, 1990-2020 (% of total)
47
Table: Nigeria's Key Population Ratios, 1990-2020
48
Table: Nigeria's Rural And Urban Population, 1990-2020
48
Methodology
49
How We Generate Our Industry Forecasts
49
Chemicals And Petrochemicals Industry
49
Cross Checks
50
Business Environment Ratings
50
Table: Petrochemicals Business Environment Indicators And Rationale
51
Weighting
52
Table: Weighting Of Indicators
52

The Nigeria Petrochemicals Report has been researched at source, and features Business Monitor International (BMI)'s market assessment and independent forecasts for key petrochemicals sub-sectors. The report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing companies by products and services, sales, market share, investments, projects, partners and expansion strategies.

BMI's Nigeria Petrochemicals Report provides industry professionals and strategists, sector analysts, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Nigerian petrochemicals industry.

Key Benefits

  • Benchmark BMI's independent petrochemicals industry forecasts to test other views - a key input for successful budgetary and planning in the Nigerian petrochemicals market.
  • Target business opportunities and risks in the Nigerian petrochemicals sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Nigeria.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity).

Coverage

BMI Industry View

Summary of BMI's key industry forecasts, views and trend analysis, covering petrochemicals markets, regulatory changes, major investments, projects and company developments.

Market Overview

Structure, size and value of the industry sector; overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.

Business Environment Rankings

BMI's Petrochemicals Business Environment Rankings provide a country-comparative Risk-Reward Rankings index aimed at investors (both corporate and financial) in the regional petrochemicals market.

The rankings methodology makes sophisticated use of over 40 industry, economic and demographic data points and is part of BMI's integrated Country Risk-Industry Rankings products.

Industry Trends & Developments

Evaluation of company and sector-wide developments, including key projects (as well as expansion plans), latest company financial details and proposed international ventures.

BMI Industry Forecasts

Historic data series (2009-2012) and forecasts to end-2018 for all key industry and economic indicators supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:

Energy: Oil production (`000 b/d), oil consumption (`000 b/d), net oil exports (`000 b/d), gas production (bcm), gas consumption (bcm), net gas exports (bcm), oil refinery capacity (`000 b/d).

Petrochemicals: Ethylene capacity (`000 tpa), ethylene production (`000 tpa), ethylene consumption (`000 tpa), polyethylene capacity (`000 tpa), polypropylene capacity (`000 tpa), polyvinyl chloride capacity (`000 tpa), polyolefins consumption (`000 tpa).

Oil Products Prices: Price forecasts for all major oil-based products (US$/bbl) at major global energy trading hubs.

Economic: Nominal GDP (US$bn), real GDP growth (%), GDP per capita (US$), population (mn), unemployment (%), exchange rate (against US$).

Company Profiles

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI's industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc