Saudi Aramco and Sumitomo Chemical plan to go ahead with a US$7 bln expansion of a petrochemical project in the kingdom, despite delays. Work is underway with the Rabigh II project, due to start operations in early 2016, as it expects the market to pull out of a recent slump due to long-term economic growth in China and resilient demand in Europe. Under Rabigh II, an existing ethane cracker will be expanded and a new aromatics complex will be built using around 3 mln tpa of naphtha to make higher-value petrochemical products.
"The industry is now at a low point, but we are not worried about its long-term prospects," as per vice-president of Sumitomo Chemical. However, an analyst opined, "If they further delayed making a decision, that would offer the US industry a bigger chance of regaining its competitiveness in the global market," said Osamu Fujisawa, an independent oil economist based in Japan.
Saudi Aramco and Sumitomo each own 37.5% of Rabigh Refining & Petrochemical, better known as PetroRabigh.