The petrochemical industry serves as the cornerstone for industrial diversification into new market segments and industries, in accord with Saudi Arabia’s recently announced Vision 2030 plan.
One of the world’s largest petrochemicals producer, Saudi Basic Industries Corp. (SABIC), through its strategic overseas investments including joint ventures and acquisitions, has steadily begun the push for economic diversification. With more than 35,000 employees operating in more than 50 countries, SABIC has always been in the forefront of the world petrochemicals map.
In July 2018, Yousef Al-Benyan, CEO of SABIC, announced the company’s plans to expand its presence in global markets, including North America, China and North Africa.
Argaam takes a look at some of SABIC’s biggest overseas investments in 2018:
China
SABIC signed a memorandum of understanding (MoU) with Fujian Provincial Government in China to develop a world-scale petrochemical complex in Fujian. The MoU came as part of SABIC's strategy to diversify its operations, seek new investments and strengthen its position in the Chinese market.
Read: SABIC inks MoU to develop petrochemical complex in China
Louisiana
SABIC has inked an initial partnership agreement with South Louisiana Methanol LP. to build a methanol plant in the United States with a production capacity of 1.8 million metric tons per annum (mtpa). The agreement comes within the company's diversification strategy which seeks to access new markets and buy feedstock at competitive prices.
Read: SABIC set to build methanol plant in USA
New York
SABIC expanded its research and development operations in Selkirk, New York in July last year. The expansion includes a 10,000 square feet warehouse for raw materials storage, 10,000 square feet of office space and 2,500 square feet of manufacturing space for formulation, blending, and testing. Work on the project has already begun, with completion expected in mid-2019.
Europe
Saudi Basic Industries Corp. (SABIC) signed a memorandum of understanding (MoU) with UK-based Plastic Energy Ltd. for the supply of feedstock to support its petrochemical operations in Europe. Under the terms of the agreement, the two companies intend to build a first commercial plant in the Netherlands to refine and upgrade a valuable feedstock, known as tacoil, which will be produced from recycling of low quality, mixed plastic waste otherwise destined for incineration or landfill.
Read: SABIC signs feedstock deal with UK firm to support growing Europe ops
Switzerland
SABIC acquired 24.99 percent stake into Clariant AG, a leading Swiss specialty chemicals producer. The company manufactures specialty chemicals, and operates via four segments, including care chemicals, catalysis, natural resources, and plastics and coatings.
Read: SABIC acquires 24.9% stake in Clariant
Singapore
SABIC expanded its existing footprint in Singapore to increase capacity of ULTEM resins, a polyetherimide material, with the new planned production facility. Expected to go online in the first half of 2021, the planned operations will localize supply for customers in Asia, reducing lead times, especially for shorter qualification cycle applications. When fully operational, the Singapore facility is expected to increase capacity by 50 percent over a 2018 baseline.
Write to Paromita Dey at paromita.d@argaamplus.com
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