Pre-Feasibility Study on Industrial Oxygen Plant in UAE

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MIM has recently finished conducting a pre-feasibility study on Industrial Gas Manufacturing Plant with production capacity of 800 6 m3 cylinders per day, with actual plant capacity of 2000 6m3 in UAE.

Business Information

The project will be producing medical grade oxygen and Industrial oxygen from free saturated air sucked from atmosphere. The process adopted to produce oxygen and Nitrogen is called liquefaction and fractional distillation of Air. The other gases that are expected to be produced in the plant are Argon and Acetylene. The technology is based on Linde & Claude process which is a Cost-effective method of producing Oxygen, Nitrogen, Argon & Acetylene for High quality industrial and medical use with high purity Oxygen/Nitrogen with high pressure to cylinders/bottles.

Market Aspects                               

The market for industrial gases are valued at USD 38.0 billion in 2011 and is expected to reach an estimated value of USD 58.4 billion in 2018, growing at a CAGR of 6.3% from 2012 to 2018.Global demand for Nitrogen and Oxygen is expected to reach USD 6.2 billion and USD 6.1 billion by 2018 respectively. Demand for industrial gases has been lower in 2013 than in 2012 because of the difficult economic environment. Steel production and coal gasification are two major end uses for oxygen. Year-to-date raw steel production is estimated to be down by 7–8% compared with the same time last year. Correspondingly, oxygen consumption is down.

Technical Aspects

The said project can be started in any specific Industrial Area in UAE. It may be in any Industrial Area of Sharjah, Dubai, Ajman or Abu Dhabi (KIZAD). The location of this proposed Pre-feasibility is however recommended at Dubai Industrial Area. The plant requires stringent governmental rules as the plant comes under hazardous manufacturing unit, therefore an environment impact study and detailed health and safety standard operating procedures have to prepared at the time of obtaining the license and no objection certificate from governmental bodies prior to building the plant.  The plant process is explained in detail in the study, the plant is based on German Technology and manufactured in Italy. Human Resource requirement is done based on requirement of production and sales of finished goods. There is good availability of skilled and qualified human resource in UAE to run the day to day operation of the plant.

Financial Aspects

Based on general assumptions with the daily output of 200 cylinders of each gas of Oxygen, Nitrogen, Argon and Acetylene, the business could generate annual revenue of AED 12 Million, against total annual expenditure of AED 7 million.