SABIC and Sinopec sign Protocol of Cooperation to explore new opportunities

Under the patronage of Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz, and in the presence of China Prime Minister Wen Jiabao, the Saudi Basic Industries Corporation (SABIC) and the China Petroleum and Chemical Corporation (Sinopec) signed a Protocol of Cooperation in Riyadh to explore new business opportunities and confirm their commitment to the principles reached in earlier agreements, including one on polycarbonate collaboration which has been approved by China’s National Development and Reform Commission (NDRC). The Protocol sets the foundation for a joint investment from both SABIC and Sinopec to build the new polycarbonate production complex with an annual capacity of 260 kilo metric tons. The new facility will be located at the Sinopec SABIC Tianjin Petrochemical Company (SSTPC) in Tianjin, China. The new polycarbonate production will help meet the projected growth in demand for North East Asia, which includes China. Satisfying this demand is essential for producing petrochemical materials from China’s vast manufacturing industries. Speaking after the signing ceremony, Prince Saud assured the importance of integration between Saudi Arabia and China, especially in the areas of petrochemicals, engineering and construction, especially as these sectors are seeking investment opportunities in both countries. He emphasised that SABIC is keen to continue its investments in China’s marketplace generally and one significant aspect of the new project is that it will use SABIC-owned polycarbonate production technology. The technology mitigates the environmental footprint in the polycarbonate production process. When the plant is fully operational in 2015, SABIC will become one of the world’s largest producers of polycarbonate, significantly boosting SABIC’s market share. The Protocol of Cooperation, which covers marketing, allows SABIC to supply polycarbonate as feedstock to the company's other plants in China and the Pacific region. Prince Saud added that the new project, along with the first joint venture with Sinopec, with an annual production capacity of three million tons, will strengthen SABIC’s competitiveness. It could even lay the groundwork for further joint ventures between the two companies, offering more opportunities for two-way exchange of technologies and sharing of markets. Long-term strategic partnerships will boost the economies of the two countries in the areas of scientific research, technological innovation, engineering, project implementation, product marketing and procurement, he said. Al-Mady said that the Protocol will strategically strengthen both SABIC and Sinopec as two pioneering companies in polycarbonate production and applications in China. SABIC brings to China its global expertise and experience in petrochemical research and production. The partnership complements SABIC's already strong engineered plastics manufacturing presence in compounded resin blends.