This 2020 vision, revealed by Abdullah al-Abdulgader, manager of mega-projects at Sabic, at the PMI conference in Bahrain in February, is stunning in both its breadth and scope. The company plans to spend almost $50,000 million over the next decade to nearly triple its total production capacity to 130 million tonnes a year (t/y) by 2020 in what is set to be the greatest organic growth story in the history of the industry.
‘The petrochemicals industry centre of gravity is moving to this part of the world and the kingdom is first choice for locating any petrochemicals industry,’ Al-Abdulgader said. ‘Today Saudi Arabia is well positioned to become a global petrochemicals hub. In 2015, the kingdom will account for 15 per cent of world petrochemicals production. Sabic’s total production will rise from 47 million t/y in 2005 to 75 million t/y in 2010 and 130 million t/y in 2020.
‘Al-Abdulgader laid out plans for 30 projects the company aims to launch during the period 2011-2020 at a total development cost of more than $48,000 million. The product slate will include 6 million t/y of olefins crackers producing ethylene and propylene, 500,000 t/y of polypropylene, 400,000 t/y of iso-octane, 800,000 t/y of aromatic products, 1.44 million t/y of styrene monomers and 5.11 million t/y of methanol products, as well as fertilisers, steel and other downstream products.
At the heart of the expansion drive will be four world-scale ethylene crackers, each with capacity of 1.5 million t/y, to come on stream between 2015 and 2019. The first will be at Sabic affiliate Arabian Petrochemical Company (Petrokemya), followed a year later by another at its subsidiary Jubail United Petrochemical Company (JUPC). Two other crackers are planned for the Jubail II industrial city on the Gulf coast.Major greenfield projects and capacity expansions are also planned for Sabic subsidiaries. The growth is not just planned for Saudi Arabia. Sabic hopes to commission its long-planned olefins complex in Fujian, China, by 2011, in addition to a planned 175,000-t/y polystyrene plant in Turkey, where it formed a joint venture with Baser Petrokimya. The firm’s European assets, acquired earlier this year from the US’ Huntsman Corporation, are also likely to be expanded.
The fact most of the new production, especially the crackers, will focus on base chemicals signifies that Sabic is not unduly concerned about potential feedstock issues, particularly with regard to ethane. Saudi Aramco is expected to bring on stream additional ethane stocks when its field development programme is completed by 2010, and this should allow the tight situation to ease.Sabic’s growth plan is not restricted to petro-chemicals and plastics. Steel also plays a major role, with more than 5 million t/y of long and flat products planned at its Saudi Iron & Steel Company (Hadeed) subsidiary in Jubail. In addition the company is planning a 6 million-t/y iron ore pelletising plant in Bahrain and a 7 million-t/y mining complex and pelletising plant in Mauritania.Inorganic growth, through mergers and acquisitions, is also on the agenda. In mid-March, Sabic announced its fertiliser expansion intentions by taking a 30 per cent stake in the multi-billion-dollar Ras al-Zour phosphate project being developed by Saudi Arabian Mining Company (Maaden). The project, once completed, will produce 20 per cent of the world’s diammonium phosphate and cement Sabic’s position as the world’s largest granulated urea producer.
But perhaps the biggest fillip of all to Sabic’s growth goals was the news in late March that it was preparing an offer for the