SABIC CEO: Teesside site has two plants; only cracker unit to shut down

Abdulrahman Al-Fageeh, CEO of Saudi Basic Industries Corp. (SABIC)

Saudi Basic Industries Corp.’s (SABIC) CEO Abdulrahman Al-Fageeh said the company’s industrial complex in Teesside, UK, includes two facilities, an ethylene cracker and a polyethylene plant, clarifying that the recent shutdown decision applies only to the cracker unit.

Speaking to Argaam during the Q2 2025 earnings conference, Al-Fageeh confirmed that the polyethylene plant in Teesside will remain operational, continuing to serve customers in the UK and Europe. The site’s financial performance will remain positive thanks to ongoing operations.

He noted that SABIC’s petrochemical sales reached nearly 9.9 million metric tons in the second quarter of this year, reflecting a 3% increase from Q1 2025, with sales volumes totaling 11.8 million metric tons for the same quarter.

Looking ahead, he said SABIC expects demand for end products across most industrial sectors to remain stable in Q3 2025. He also pointed to a notable recovery in demand for the industrial solutions, the electronics and electricals, as well as the hygiene and healthcare segments.

Al-Fageeh revealed that SABIC is currently evaluating strategic options for its subsidiary, National Industrial Gases Co., including a potential initial public offering. This is part of a broader strategy to focus on core operations and enhance value and competitiveness.

As part of its innovation push, SABIC launched over 58 new products in the first half of 2025, reflecting its commitment to offering new industrial solutions.

He added that the Petrokemya expansion project in Jubail is 95% complete, with a planned annual capacity of one million metric tons. Trial operations are set to begin in Q3 2025.

Meanwhile, SABIC’s Fujian project in China is progressing on track, with trial operations anticipated in the second half of 2026.

SABIC posted a net loss of SAR 5.28 billion in H1 2025, against a profit of SAR 2.43 billion in the prior-year period. Losses in Q2 alone amounted to SAR 4.1 billion, largely due to exceptional expenses and provisions.

This came as the company booked SAR 3.78 billion in impairments and asset write-downs related to the Teesside cracker unit closure, as part of a broader transformation strategy that aims to cut costs and enhance profitability.

SABIC runs key industrial assets in Teesside, UK, centered on two main units. The first is the Olefins 6 ethylene cracker, which was shut down in Q2 2025 and is now being converted into a gas cracker to process ethane feedstock.

The second is the System 18 plant, launched in 2009, which ranks among the world’s largest low-density polyethylene (LDPE) lines, manufacturing around 15 different grades.

The plant operates using ExxonMobil-licensed technology, with ethylene sourced from the Olefins 6 cracker unit. Some of its output is exported through SABIC’s North Tees site.