The MENA Advantage - a story of capacity expansion, integration, sustainability, and innovation

In the MENA region, the refining and petrochemicals industries are evolving, with a focus on capacity expansion, integration, sustainability, and innovation. These industries are central to the region's economic diversification goals, and their continued development will depend on addressing global market dynamics, environmental concerns, and geopolitical challenges.

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In Saudi Arabia, the host country once again for ESF MENA 2024, the refining and petrochemicals industries face challenges related to market volatility, environmental sustainability, and geopolitical risks. However, the opportunities for growth and diversification, driven by Vision 2030, integrated complexes, innovation, and strategic location, are significant. The industry's success will depend on its ability to navigate these challenges while leveraging its strengths and capitalizing on emerging opportunities.

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Ahead of the 4th edition of ESF MENA - Middle East Energy & Sustainability Forum, we assembled a select group of influential global and regional refining & petrochemicals leaders, to discuss the principal issues, challenges, and opportunities that will drive the sustainability and decarbonisation agenda in the downstream industry, both short and longer term. Here’s a few key takeaways from that important discussion.

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It’s in the Science

As the region continues to focus on blue and green projects, there is an increasing emphasis on science-based approaches to reducing carbon intensity. This shift reflects a broader trend toward sustainability, decarbonization, and environmental responsibility in the refining and petrochemical sectors. Here's a breakdown of how this is unfolding:

• Blue hydrogen production is gaining traction with investments in CCS technologies and infrastructure supporting blue projects.
• Saudi Arabia and the UAE are developing large-scale renewable energy projects that can support green hydrogen production, contributing to a lower carbon intensity for refining and petrochemical processes.
• Disclosing carbon intensity metrics and setting targets to reduce emissions in line with science-based principles. This shift contributes to greater accountability and transparency in the industry.
• Integrating sustainability into their operations by adopting energy-efficient technologies, reducing waste, recycling, and implementing circular economy principles.
• Exploring alternative feedstocks, such as bio-based materials, to reduce carbon intensity and transition to more sustainable practices.
• Collaboration on regional initiatives to promote sustainability and reduce carbon intensity. These collaborations aim to share best practices, align on common goals, and drive progress toward a lower-carbon future.
• A stated commitment to reducing carbon footprints and achieving net-zero emissions by mid-century.

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The MENA Advantage

The region has several advantages in terms of decarbonizing its refining and petrochemicals industries:

• Abundant Renewable Energy Resources - particularly solar and wind.
• Geopolitical Influence and Wealth - oil and gas wealth, and significant influence in global energy markets.
• Economies of Scale - home to some of the world's largest refineries and petrochemical complexes, allowing economies of scale in implementing new technologies.
• Infrastructure for Carbon Capture and Storage (CCS) - significant geological formations, particularly depleted oil and gas fields.
• Commitment to Diversification and Sustainability - actively pursuing economic diversification strategies to reduce their reliance on oil and gas exports.
• Innovation and Technology Adoption - investing in innovative technologies for decarbonization, including advanced refining techniques, hydrogen production, and energy-efficient petrochemical processes.
• Strong Policy Frameworks and International Partnerships - engaging in international partnerships, fosters technology transfer and best practices aiding decarbonization efforts.
• Economic Diversification through Petrochemicals - enabling continued economic growth while addressing environmental concerns.
• Export Potential for Green Products - a possible leading position in the production of green petrochemical products could open up new export markets and support the region's diversification goals.
• Strategic Location - ability to serve multiple markets, East and West.

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Accelerating the Transition

The enablers that are needed to accelerate the downstream sectors transition to a green economy.

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Certification

Certification and lifecycle assessment of low carbon products exported from the region can be a complex process, with diverse standards and certifications depending on the export destination, lifecycle assessment (LCA) complexity (from raw material extraction to production, use, and disposal), data collection and quality, regulatory variability (different countries have varying environmental regulations and standards), local environmental practices, technological requirements, certification costs and timelines, stakeholder coordination, and continuous monitoring and improvement.

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However, despite these complexities, achieving certification and conducting thorough LCAs can offer significant benefits, such as improved marketability, compliance with international standards, and contributing to sustainability goals. Companies in this region exporting low carbon products should approach the process with a strategic mindset and a commitment to environmental responsibility.

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Digital

Whether it be efficiency improvement, predictive maintenance, resource optimization, reduced emissions, environmental monitoring and compliance, supply chain transparency, data-driven decision making, employee safety and well-being, digitalization can play a significant role in transforming the refining and petrochemicals industries into more sustainable operations. By optimizing processes, reducing waste, and enhancing environmental monitoring, these industries can move toward greater sustainability while maintaining their economic viability.

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However, implementing this type of digital technology involves various challenges that must be addressed to ensure successful adoption and implementation. To overcome these challenges, you need to take a strategic approach, focusing on key areas like stakeholder engagement, needs assessment, risk analysis, vendor evaluation, and change management. Successful implementation also involves continuous evaluation and iterative improvements to ensure the digital solution continues to meet industry requirements and business objectives.

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Human Capital

To attract and retain human capital in the refining and petrochemicals industries in this region, companies need to address several key factors that influence job satisfaction, employee engagement, and career growth.

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Obviously, competitive compensation and benefits, career development and training, work-life balance, cultural sensitivity and inclusivity, are all important factors, but the industry desperately needs to change public perception, especially what is being portrayed on social media, and companies need to ‘build a strong employer brand’ by showcasing their strengths, e.g. commitment to sustainability, advanced technology and innovation, safety, community involvement, etc, and showcase the products they produce that improve and enhance everyday life.

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By doing this, the industry can enhance their appeal to talent and create a work environment that fosters long-term retention and job satisfaction. The key is to balance competitive compensation with a positive workplace culture, career growth opportunities, and a strong commitment to safety and sustainability.

Join our Esteemed Speaker Panel!

Taking a technology-neutral approach, ESF MENA will present and explore all the decarbonisation technologies and strategies on the table including:

• Sustainable fuels, chemicals and circularity
• Low carbon hydrogen, green ammonia and methanol
• CCUS

• Energy efficiency and asset optimization, including digitisation
• Waste water use and management
• Industrial integration, collaboration and clusters

Case studies and practical examples of technology application and implementation will be favoured.

?? Submit your abstract!

?? Learn more about the event: europetro.com/esfmena

?? Read the full Advisory Report!