Sabic, Sinopec sign $1.7bn petchem complex deal
Riyadh, January 31, 2008
Saudi Basic Industries Corporation (Sabic) and China Petroleum and Chemical Corporation (Sinopec) today signed a Heads of Agreement (HOA) to form a joint venture that will establish a $1.7 billion ethylene derivatives complex in China.
The 50:50 joint venture company will invest in the 1 million tonnes per year of ethylene derivatives complex (600,000 tonnes of polyethylene and 400,000 tonnes of ethylene glycol) to be set up in Tianjin. It will receive all its ethylene feedstock from an ethylene cracker owned by Tianjin Petrochemical Company, a branch of Sinopec.
The complex is scheduled to be completed by September 2009.
The agreement was signed at a ceremony in Beijing by Sabic chairman Prince Saud bin Abdullah bin Thenayan Al-Saud and Sinopec chairman Su Shulin.
Prince Saud said: “The new joint venture with Sinopec Corp will further strengthen the links between our two companies. This will be Sabic’s first joint venture in China and we hope this will lead to more joint ventures and a strong relationship with Sinopec in the important China market.”
Sabic already has a strong relationship with Sinopec and Chinese engineers from Sinopec are currently helping to construct a world-scale polyolefins complex for Sabic affiliate Yanbu National Petrochemicals Company in Yanbu, Saudi Arabia.
“China is an important market for Sabic’s global strategy. This Heads of Agreement is a key milestone towards realising Sabic’s goal of establishing a manufacturing centre in Asia. This facility in Tianjin will serve customers in the world’s fastest growing market, and is an important component in Sabic’s corporate strategy of being among the world’s top petrochemical companies by 2020,” said Mohamed Al-Mady, Sabic vice chairman and CEO. – TradeArabia News Service