Saudi Aramco, Dow sign JV for chemicals complex

Saudi Aramco has signed a joint venture agreement with Dow Chemical for an integrated chemicals complex, named Sadara Chemical Company, in Jubail Industrial City, it has been announced. 

The joint venture is another major step forward for Sadara, which will comprise 26 manufacturing units, several of which constitute mega projects in themselves.

Once complete, the JV complex will be one of the world's largest integrated chemical facilities and the largest-ever built in one single phase, a statement released following signing of the agreement said.

Saudi Aramco and Dow announced their respective board authorisations for formation of the JV on July 25, 2011.

The first production units are expected to come onstream in the second half of 2015. All units are expected to be up and running in 2016.

Just over 100 kilometres from where the agreement was signed, bulldozers, graders and rollers are proceeding with site preparations for the world-scale, mixed feed cracker, which will be integrated with Saudi Aramco's extensive hydrocarbon infrastructure.

Saudi Aramco President and Chief Executive Officer Al-Falih said: "Sadara is a milestone for Saudi Aramco and a cornerstone of our transformational downstream growth strategy, which will add further value to our significant petroleum value chain."

"As the world's largest integrated and most reliable supplier of energy and petroleum-based derivative products, our strengths complement those of Dow, the world's foremost chemicals company with a global track record and unique suite of chemicals technology," he added.

Sadara is expected to deliver annual revenues of approximately USD 10 billion within a few years of operation, while contributing significantly to Saudi Arabia's industrial diversification.

The planned product portfolio will add value to the kingdom's vast natural resources and complement the existing chemical landscape.

Ultimately, the JV will be instrumental in Saudi Arabia's strategy to not only become a strategic chemicals and plastics producer, but also a hub for future downstream manufacturing.

"Sadara is an extraordinary and unique venture that will build upon the strengths of both Dow and Saudi Aramco to deliver the diversified and specialty materials and chemicals needed to drive growth in the entire region and beyond," said Dow Chairman and Chief Executive Officer Andrew Liveris.