PIF funds Jubail venture

04 October 2002

The Public Investment Fund (PIF) announced in late September an agreement to provide SR 1,230 million ($328 million) finance for a petrochemical project planned by Jubail Chevron Phillips (JCP), the sister company to Saudi Chevron Phillips (SCP), the kingdom's first private petrochemicals company. The total value of the project has been put at about $1,000 million (MEED 27:9:02).

JCP will now seek funding from the Saudi Industrial Development Fund (SIDF). Under SIDF regulations, the project is eligible for financing worth SR 700 million ($187 million). The company has not yet decided how much further debt to seek through project finance. Equity in the project is held by the US' Chevron Phillips Chemical Companyand the Saudi Industrial Investment Group, composed of about 70 local investors.

Under the expansion programme, JCP will add some 715,000 tonnes a year (t/y) of styrene, 250,000 t/y of propylene and 405,000 t/y of motor gasoline to the existing capacity at SCP's plant of 550,000 t/y of benzene, 220,000 t/y of cyclohexane and 370,000 t/y of motor gasoline. The JCP expansion will be fully integrated into the SCP complex.

The next stage of the project will be the appointment of a front-end engineering and design (FEED) contractor, expected by the end of the year. An engineering, procurement and construction (EPC) contract will be launched in 2003.

PIF was set up by the government to provide finance for commercial projects judged important to the economy. In addition to its role as a debt financier, it owns equity in a number of local and Arab corporations.

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