The Saudi Basic Industries Corporation (SABIC) and the Saudi International Petrochemical Company (Sipchem) announced signing a Memorandum of Understanding (MoU) for setting up of new projects in the city of Al-Jubail, Saudi Arabia. The projects include seven plants with an estimated investment of US$3.2 bln which SABIC will construct to produce 250,000 tpa of methyl metha acrylate (MMA), 30,000 tpa of poly methyl metha acrylate (PMMA), 200,000 tpa of acrylonitrile, 50,000 tpa of polyacrylonitrile, 50,000 tpa of polyacetyl resins, 3,000 tpa of carbon fiber and 40,000 tpa of sodium cyanide. Additionally, Sipchem will build two plants for an estimated cost of US$810 mln for the production of 125,000 tpa of poly vinyl acetate and 200,000 tpa of ethylene vinyl acetate. These plants are expected to go on-stream by mid 2013. The two companies will utilize their existing infrastructure and manufacturing capacity to process Saudi Aramco feedstock allocated by Ministry of Petroleum and Mineral Resources for the new projects.
According to the MoU, a SABIC manufacturing affiliate will crack the feedstock allocated to Sipchem and also provide it with ethylene. One of Sipchem's manufacturing companies will supply carbon monoxide to SABIC for the production of MMA. The two companies will move forward on these projects after the completion of economic studies and legal procedures. Further, SABIC and Sipchem will jointly establish specialized R&D centers to develop product applications related to this investment project. Their aim will be to promote and encourage local downstream industries, especially in the areas of automotive parts, electrical appliances, household commodities, computers and electronic equipment and health care and provide support to national downstream industries, especially the plastic industries sector.