SABIC and Exxon Mobil, who have been partners for 36 years at the Al-Jubail plastics-producing site in Saudi Arabia, are planning to build and jointly own a major petrochemical complex in Texas or Louisiana near natural gas feedstock.
SABIC has long indicated it wanted to be a player in the fracking revolution in the United States. The new plant will include a world-scale steam cracker and derivative units, presumably polyethylene and possibly polypropylene.
Before making final investment decisions, the companies will work with state and local officials to help identify a potential site with adequate infrastructure and conduct economic and marketing analyses.
“We are focused on geographic diversification to supply new markets,” said Yousef Abdullah Al-Benyan, SABIC vice chairman and chief executive officer. “The proposed venture would capture competitive feedstock and reinforce SABIC’s strong position in the value chain.”
Neil Chapman, president of ExxonMobil Chemical, said: “We have the capability to design a project with a unique set of attributes that would make it competitive globally. That is vitally important as most of the chemical demand growth in the next several decades is anticipated to come from developing economies.”
The project in Al-Jubail (called Kemya) is a 50/50 JV between SABIC and Exxon Chemical Arabia. The joint venture was established in 1980, and produces ethylene, propylene, low-density polyethylene and linear low-density polyethylene.
The site has the capacity to produce about 700,000 metric tons per year of ethylene, and more than 1.1 million tons of polyethylene.
SABIC and ExxonMobil have begun construction on a new, multibillion-dollar elastomers plant at the site. The facility will have the capacity to produce about 400,000 metric tons per year of TPEs and related products.