Saudi Aramco and Dow Chemical Co. have come together to build and operate an integrated chemicals complex in Jubail Industrial City. The complex will be one of the world?s largest integrated chemical facilities, and the largest ever built in one single phase. The construction of the project, worth SR75 billion ($20 billion), is scheduled to begin immediately. The entire units are expected to be up and be operational around 2016.
The joint venture called “Sadara Chemical Company” will build one of the world’s largest chemical facilities, producing more than three million metric tons of chemical products and plastics a year. Sadara is expected to deliver annual revenues of around $10 billion within a few years of its operation. It also expects to generate thousands of direct and indirect employment opportunities in downstream value parks.
The boards of directors of both companies approved the project after an extensive project feasibility study and front-end engineering and design effort that began in 2007.
“We are pleased to have Dow as our partner, as they bring a fantastic record of success in the chemicals business and a top-tier brand to the project,” said Saudi Aramco President and CEO Khalid Al-Falih.
Dow Chemical Co. has a superior mix of downstream product technologies, and world-class operational and marketing capabilities that will complement the strengths of Saudi Aramco. Saudi Aramco is the world’s largest integrated and reliable supplier of energy and petroleum-based derivative products. The kingdom?s government owns Saudi Aramco. Aramco manages OPEC kingpin?s immeasurable oil reserves, which it estimates during only over 260 billion barrels, as well as a world?s fourth-largest reserve of healthy gas.
The enterprise will play a key role in the Kingdom’s industrial and economic diversification and will contribute to the creation of thousands of high quality jobs.
Sadara will become an equal joint venture between Saudi Aramco and Dow after an initial public offering. Total investment for the project will be approximately $20bn.Export credit agencies and financial institutions will also provide project financing apart from the equity of its partners.
Sadara will have 26 manufacturing-unit complexes that will produce a wide range of performance products such as polyurethanes, propylene oxide, propylene glycol, linear low-density polyethylene, low-density polyethylene, glycol ethers and amines.
The complex will possess world-scale cracker with cracking capabilities for producing over 3m. metric tons of high value-added chemical products and performance plastics, capitalizing on rapidly growing markets in energy, transportation, infrastructure and consumer products.
The local marketing, which includes eight zones, will be the responsibility of Sadara, while Dow will market and sell to all countries outside the Middle East.
Andrew N. Liveris, Dow’s chairman and CEO, said, the premier partnership is the right economic ownership model with the right partner. He also said customers in emerging geographies such as China, the Middle East, Eastern Europe and Africa will benefit from a strong supplier with feedstock integration, in-market commercial and supply capabilities, advanced technologies and resources to grow with their demand.
Source: Arab news, ibtimes.com