Saudi Basic Industries Corporation (Sabic) and Exxon Mobil Chemical are looking to drum up interest from bidders for a new petrochemical project, contracting sources said on Wednesday.

Building petrochemical capacity is part of the kingdom's plan to diversify its economy away from oil exports.

Sabic and Exxon Mobil's chemical unit signed a preliminary agreement in November to establish the multi-billion dollar synthetic rubber joint venture at their plants in Jubail and Yanbu.

The two companies would issue bid packages for the Jubail plant by the end of the year, Saudi-based contracting sources said. Executives from Sabic, Exxon and contracting companies were meeting in Houston on Wednesday to discuss the project, contractors said.

The deadline for companies to submit documents for prequalification to bid for the packages was Wednesday, contractors said.

The project would have a combined production capacity of 400,000 tonnes per year of carbon black, rubber and specialty polymers for both domestic and international sale.

Plants would be based at the Kemya complex in Jubail and the Yanpet complex in Yanbu. Yanpet is a 50-50 joint venture between Mobil Yanbu Petrochemical Co Inc, an affiliate of Exxon Mobil Chemical and Sabic.

Kemya is a 50-50 joint venture between Sabic and Exxon Chemical Arabia Inc, also an affiliate of Exxon Mobil Chemical. Plans for Yanpet have yet to be announced.

Sabic said on Sunday it would raise its petrochemicals output by about 12 million tonnes by the start of 2012 after it posted a 76 per cent drop in second-quarter profit.

Sabic benefits from access to cheap energy feedstock in the world's top oil exporter, giving it a competitive advantage over global rivals.Exxon Mobil is the world's largest non-government controlled oil company by market capitalisation.-Reuters