Reflecting the group’s enhanced cash position, the Mesaieed Petrochemical Holding Company (MPHC) posted a half-yearly net profit of QR899.4mn.

Mesaieed Petrochemical Holding Company is a subsidiary of Qatar Petroleum and one of the region’s premier diversified petrochemical conglomerates with interests in the production, distribution and sale of olefins, polyolefins, alpha olefins and chlor-alkali products.

Mesaieed Petrochemical is the holding company of some six firms, with three of them directly held: MPHC holds 49.0% of the issued share capital of each of Qatar Chemical Company (Q-Chem) and Q-Chem II and 55.2% of the issued share capital of Qatar Vinyl Company (QVC).  

Both Q-Chem and Q-Chem II each have a single, wholly-owned subsidiary, while Q-Chem II also has an effective ownership of 53.85% of Ras Laffan Olefins Cracker Company.

The group’s facilities are all based within Qatar, and are primarily engaged in the production of olefins, polyolefins, alpha olefins, and chlor-alkali products.

HE the Minister of Energy and Industry Dr Mohamed bin Saleh al-Sada, also chairman of Mesaieed Petrochemical Holding Company, said, “MPHC closed the half year ended on June 30, 2014 with strong earnings of QR899.4mn, clearly indicating the group’s ability to generate strong profits and cash flows. All group companies exceeded their budgeted expectations. In addition, cash generation remained strong, with a total of QR894.8mn of cash from operations across all group companies for the half year. These results bode well for the balance of year outlook.

“The Board of Directors and senior management look forward to the remainder of the year 2014 with renewed confidence as the company seeks to establish itself as one of the region’s premier diversified petrochemical conglomerates.”

On the financial results for the half year, Mesaieed Petrochemical Holding Company chief coordinator Khalid al-Subaey said, “The group maintained strong EBITDA margins for the half year that ended in June, which was aided by resilient key product prices, supply of competitively priced ethane feedstock and fuel gas under long-term supply agreements with Qatar Petroleum and the recognition of a tax refund from the Public Revenues and Tax Department. Cash across all group companies as at June 30, 2014 remained at QR1.6bn, indicating the group’s strong cash position. The utilisation rates remained strong except during general shutdown of QVC plants.”

On the combined performance of Q-Chem / Q-Chem II, al-Subaey said, “The business unit for the half year recorded revenue of QR1.8bn, with polyolefins constituting 71% of revenue, alpha-olefins 26% with the remainder attributable to other minor products. The revenue exceeded budget expectations, and was primarily based on strong overall utilisation rates.

“During the period, nearly 216,000 tonnes of polyolefins and 88,000 tonnes of alpha-Olefins were produced with a combined overall utilisation rate of 103% broadly in line with the historical average. In line with the business unit’s production and sales strategy, the polyolefin/alpha-olefin production mix was adjusted versus the previous quarter of 2014 in order to take advantage of pricing and market opportunities identified during the quarter.

“Overall, during the second quarter, prices of key polyolefin and alpha-olefin products were largely flat across the industry in comparison to the previous quarter of 2014.”

QVC revenue was QR348.3mn from the sale of its chlor-alkali products for the half year that ended in June.  

“Results were marginally impacted by planned shut-downs of the company’s ethylene dichloride (EDC), vinyl chloride monomer (VCM) and caustic soda facilities.  This major shut-down started towards the end of February and was completed in May, 2014, and is in accordance with the plants’ major maintenance cycles. The average production utilisation for the period was 92%, 52%, and 72% for the EDC, VCM and caustic soda facilities respectively affected by the general shutdown.”