RIYADH: Saudi Basic Industries Corporation (SABIC) announced that it has obtained all necessary regulatory approvals including environmental permits to establish a petrochemical joint venture project with Exxon Mobil in the U.S. Gulf Coast.
“Saudi Basic Industries Corporation (SABIC) expects that this project will have a positive impact on its consolidated financial statements. The financial impact will be reflected after the commercial operation and project completion,” a notification sent to Saudi Stock Exchange (Tadawul) said on Thursday.
The cost of the project in San Patricio County, Texas, is estimated at about $7.3 billion; with engineering, procurement and construction (EPC) contracts signed with Chiyoda Kiewit Joint Venture and CTCI McDermott.[the_ad id=”31605″]“It is expected to start the initial engineering and construction during the second quarter of this year and expected to be completed during the fourth quarter of the year 2021,” SABIC said in an earlier notice.
The project – which will have an ethylene capacity of 1.8m tonnes/year and will include a monoethylene glycol (MEG) unit and two polyethylene (PE) plants – “is expected to start up during the first half of 2022”, the company said.
“The project reflects SABIC strategy to focus on geographical diversification to reach new global markets and enable the company to access competitive feedstock,” the Saudi petrochemical giant said.
In a separate announcement on 1 May, ExxonMobil said a joint venture was created to pursue the project called Gulf Coast Growth Ventures. This is the company’s third tie-up with SABIC in Saudi Arabia.
The project “is expected to create 600 new, permanent jobs, about 3,500 indirect and induced jobs during operations, as well as 6,000 construction jobs during the peak of construction”, ExxonMobil said.