Kanoo Freight, a division of Yusuf Bin Ahmed Kanoo, and US-based BDP International, have formed a joint venture to serve the logistics and transportation needs of the Middle East’s burgeoning chemical and petrochemical industry.

The new entity, named BDP Kanoo Chemical Logistics, will be based in Dammam, Saudi Arabia.

“It’s a 50:50 joint venture company,” said Fawzi Ahmed  Kanoo, board director, Yusuf Bin Ahmed Kanoo Group, and chairman of Kanoo Freight.

He, however, did not disclose the financial terms of the agreement between the two privately held companies.

“The establishment of this joint venture will provide the services needed for the region to fulfill its vision of economic diversification and adding more value downstream in the hydrocarbon industries,” said Kanoo.

“With the emergence of the Middle East as a global logistics hub, customers in the chemical and petrochemical sector place a great deal of importance on reliable on-time supply, and BDP Kanoo is designed to focus on delivering against or exceeding these expectations,” he added.

“With significant investments in the downstream petrochemical industries and abundance of feedstocks, the Middle East, and the Saudi Arabia in, particular, is becoming the epicenter of the global petrochemical industry,” said BDP president and CEO Bolte, Jr.

“We have a substantial base of clients operating in the region which stand to benefit from our strong presence in the global chemical and petrochemical sector complemented by Kanoo’s deep expertise in regional and local trade and regulatory practices,” he added.

“We are very optimistic that the company’s revenue in the first year itself will grow rapidly,” Bolte said and added, “We will pursue aggressive growth target of at least 25 per cent per annum.”

According to World Trade Organsiation (WTO) figures, Saudi Arabia’s petrochemical exports topped $14 billion in 2008.

While petrochemical production was down 12 per cent in North America and 6 per cent in Europe last year, Middle East production grew 14 per cent, a trend which is forecast to continue.

Industry analysts forecast that within 10 years, the Middle East will account for approximately 75 per cent of the world’s petrochemical exports, led by Saudi Arabia.

BDP Kanoo Chemical Logistics will offer a full suite of logistics services, including freight forwarding, customs brokerage, marine, air and ground transportation, warehousing and distribution, project and energy logistics, regulatory and security compliance, process management and supply chain solutions, a statement said. – TradeArabia News Service