SABIC, Shell plan Sadaf JV expansion; seek opportunities outside Saudi
Dubai (Platts)--12Nov2012/842 am EST/1342 GMT
Saudi Basic Industries Corp (SABIC) and Shell Chemicals are planning
expansion projects at their Sadaf joint venture petrochemical complex and are
also exploring investment opportunities outside Saudi Arabia, the companies
said in separate statements Monday.
Sadaf is a 50:50 joint venture that SABIC and Shell formed in the early
1980s. It produces 4.7 million mt/year of petrochemicals, including
ethylene, ethanol, styrene monomer, ethylene dichloride, caustic soda, and
methyl tertiary butyl ether at the Al Jubail site in Saudi Arabia.
The companies will conduct a study for a new styrene monomer propylene
oxide (SMPO) and polyols project, Riyadh-based SABIC said in a filing to the
Saudi stock exchange Tadawul.
In a separate statement, Shell said it and SABIC are "progressing plans
for the expansion of various projects" at Sadaf.
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They are developing a "full range of polyols and SMPO plants" at the
Sadaf site and the studies to implement this plan are currently underway, it
"The proposed full range of polyols and SMPO plants would be the first
of their kind in the Middle East. The assets would employ Shell's proprietary
polyols and SMPO technologies to produce chemical building blocks for the
polyurethanes industry and petrochemicals sector in the Middle East and
beyond," Shell said.
The expansion projects aim to respond to increasing demand from the
construction, transportation, sports goods, food packaging, and home
appliances industries, it added.
The two did not disclose details on production capacity or the expected
cost of the project.
The companies also confirmed they are exploring opportunities outside
Sadaf and Saudi Arabia.
They said this plan will "build on their strong long-term relationship"
of more than 30 years.
"The two companies will in due course announce any further major updates
regarding their partnership," SABIC said.
No other details were provided. Shell declined to comment further when
contacted by Platts.
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--Monicca Egoy, email@example.com
--Edited by Jeremy Lovell, firstname.lastname@example.org