Oman-based Octal Petrochemicals said it has started operations at its $350 million Salalah plant, which is the largest Polyethylene terephthalate (PET) resin plant of its kind in the Middle East.

The new Octal PET plant, located at the southeast port city in Oman, has a production capacity of 300,000 metric tons per annum, thus making it the largest clear rigid PET sheet plant in the world.

As leading clean energy producers gather at the World Future Energy Summit in Abu Dhabi this week, Octal can also point to a major technological breakthrough in the manufacturing processes of its new facility that delivers enhanced energy and cost savings, said a company official.

Octal chairman Sheikh Saad Suhail Bahwan said: “The new plant marks the company’s emergence as a global player in PET resin and clear rigid sheet packaging.'

'Our investment delivers dramatically enhanced scale, breakthrough technology, and crucial cost and quality advantages at a time when customers need them most,' he noted.

According to him, food and consumer packaging markets in the US, Europe and China will the company's prime targets this year.

'The first orders of PET resin to Europe have been shipped this month, and Octal expects total per annum sales to reach $400 million by the end of this year,' Bahwan added.

In just over two years, Octal has become the largest exporter from the port of Salalah and a growing local employer. Octal uses world-first technology to produce clear rigid PET sheet directly from melted PET resin, delivering significant energy savings and enhancements to the quality and clarity of the final product.

Nicholas Barakat, Octal managing director, said: “Our patented DPET™ technology uses a single-phase reactor to integrate PET resin and sheet manufacture.

'The technology bypasses the expensive PET drying and melting process of conventional clear rigid sheet manufacture, producing PET sheet with superior optical and mechanical properties and using 65 per cent less energy,” he explained.

“The new technology involves enhanced gauge control, creating additional cost savings by achieving higher yields. Our production processes also meet stringent environmental standards – we only use recycled municipal wastewater and PET is 100 per cent recyclable,” Barakat added.

Octal’s integrated PET resin and clear rigid sheet production plant was built at an initial cost of $350 million, complementing an existing PET sheet plant opened in Salalah Free Zone in late 2006.

The total PET resin capacity is 150,000 metric tons per annum and PET sheet capacity is now 180,000 metric tons per annum.

A second phase of expansion will be completed in early 2011, increasing the capacity in PET resin by another 500,000 metric tons. At this stage, Octal will be the largest PET resin company on one site outside China.

Octal employs 250 staff, mostly in Salalah, and plans to hire another 100 this year. Around 30 per cent of employees are Omani nationals.

Barakat said the first phase was nearing completion and the company remained on track with the second phase.

'Despite the global economic challenges, regional investor interest remains strong and the capital is in place to deliver on our stated growth plans,' he added.

Octal has placed an initial raw materials order worth $7 million with Saudi Basic Industries Corporation for PTA, a key chemical used in PET manufacture.

Octal’s annual demand for PTA (purified terephthalic acid) is set to exceed $175 million when the new plant ramps up to full capacity in March 2009.

Other raw materials and equipment orders placed in the region include a contract for mono-ethylene glycol (MEG) worth $60 million with MEG Global of Kuwait, and steel contracts with a combined value of $30 million with Mammut Industries of the UAE and Kuwait’s Kir