Qatar Energy and Chevron Phillips Chemical announced on Sunday that they have made a final investment decision on the $6 billion Ras Laffan Petrochemicals Complex, which is set to be the largest of its kind in the Middle East.

The complex, which is expected to begin production in 2026, will include an ethane cracker with a capacity of 2.1 million tons of ethylene per year, as well as two high density polyethylene derivative units with a total production capacity of 1.7 million tons per year.

This project highlights the efforts of Middle Eastern oil producers to expand into petrochemicals, which are used in the production of plastics and packaging materials, as they look to diversify their sources of income beyond exporting crude oil and natural gas.

Under the agreement signed on Sunday, state-run Qatar Energy will hold a 70% stake in the venture, with Chevron Phillips Chemicals holding the remaining 30%. Qatar Energy Chief Saad al-Kaabi Kaabi stated that this marks Qatar Energy's largest investment ever in Qatar's petrochemical sector and is an "important milestone" in Qatar's downstream expansion strategy.

The Ras Laffan Petrochemicals Complex, located in the Ras Laffan industrial city, is expected to significantly impact Qatar's ethylene production capacity, as it is set to double on the back of the new complex. Local polymer production will also increase from 2.6 million to 4 million tons per year.

Qatar is already one of the top producers of liquified natural gas (LNG) in the world and is actively expanding its North Field gas field, which is expected to increase its liquefaction capacity from 77 million tons per year to 126 million tons by 2027.