Communicator

Saudi Arabia, 27 Feb 2025 - Saudi International Petrochemical Company (Sipchem) and global chemical giant LyondellBasell have announced a significant partnership to explore the development of a world-scale mixed-feed cracker in Saudi Arabia, bolstered by their successful securing of feedstock allocation from the Saudi government.

The two companies have signed a memorandum of understanding (MoU) to conduct a joint feasibility study for the proposed facility, which would utilize both ethane and refinery off-gases as feedstock. This mixed-feed approach offers greater flexibility in raw material sourcing while potentially improving the economics of the operation.

The proposed cracker would be integrated with downstream units to produce a range of high-value petrochemical products, including polyethylene, polypropylene, and various specialty chemicals. Industry analysts estimate the total investment could exceed $5 billion, though the companies have not confirmed specific figures pending the feasibility study's completion.

For LyondellBasell, the partnership represents a strategic move to expand its presence in the Middle East, a region that offers competitive feedstock advantages and growing domestic markets. The company has been actively restructuring its global portfolio, seeking opportunities in regions with favorable economics while potentially divesting from higher-cost locations.

The Saudi government has strongly supported the development of domestic petrochemical capacity through initiatives like Vision 2030, which aims to reduce the country's dependence on crude oil exports by developing downstream industries, aligning with national priorities to capture more value from the country's natural resources.

If the feasibility study yields positive results, construction could begin as early as 2026, with production potentially starting by 2029. The facility would likely be located in Jubail Industrial City, where Sipchem already operates several petrochemical plants and where existing infrastructure could support the new development.

The project faces competition from similar large-scale petrochemical developments in the region, including those being pursued by Saudi Aramco and SABIC. However, industry experts believe growing global demand for petrochemical products, particularly in emerging Asian markets, provides room for multiple new facilities.

The announcement comes as part of a broader wave of petrochemical investments in Saudi Arabia and the wider Gulf region, as producers seek to capitalize on competitive feedstock costs while meeting growing global demand for plastics and other petrochemical derivatives.

#aramco  #sabic  #sipchem  #lyondellbasell  #steamcracker  #ethane  #rog  #polyethylene  #polypropylene  #saudirabia 

Sipchem announced on July 4th on Linkedin to have "signed an Engineering and procurement Sign off of its Expanded Production Capacity for High-VA  Ethylene Vinyl Acetate ( EVA) production plant."

"This investment will enable Sipchem to produce innovative EVA grades designed to support downstream production of Solar Encapsulate Cells as well as certain Hot Melt Adhesives." the company stated. 

The production plant, based on ExxonMobil's tubular reactor technology, belongs to International Polymers Company, a subsidiary JV of Sipchem and Hanwha Solutions Corporation, and is installed in Al-Jubail, 🇸🇦 KSA. 

With a design capacity of 200,000 tpa, the plant is thought to be running at close to 220,000 tpa. Debottlenecking by an additional 70,000 tpa will bring the plant output close to 290,000 tpa.

The company declined to comment on the engineering solution that will be employed to increase the plant capacity.

#sipchem  #exxonmobil  #saharainternational  #hanwha  #tubularreactor  #ldpe  #eva  #highpressure  #vinylacetate  #saudiarabia  #solarpv