Sipco is considering a single LAB unit should Aramco's feedstock price raise the cost of producing n-paraffin above the international price. The company is already talking with potential suppliers to provide n-paraffin to meet feedstock demand for the 80,000-tonne-a-year LAB unit.

The integrated project was originally estimated to be worth about $230 million. However, if the n-paraffin unit is omitted, costs will come down to $120 million-130 million.

The front-end engineering and design (FEED) for the project is being carried out in-house by India's Tamilnadu Petroproduct (TPL), which is a 50:50 joint venture partner in Gulf Petroproduct with Saudi Offset Limited Partnership (SOLP). The appointment of a project management consultant (PMC) has been put on hold until the project's fate has been determined.

Financial close for the project, which is being financed through a combination of debt, equity and a $115 million Saudi Industrial Development Fund (SIDF) loan, is scheduled for the end of March 2004. Sipco's financial adviser is Apicorp Taylor-DeJongh Advisory Services.