Sabic and ExxonMobil petrochem jv feasibility on US Gulf coast

Sabic and an affiliate of Exxon Mobil Corporation are considering the potential development of a jointly owned petrochemical complex on the US Gulf Coast. If developed, the project would be located in Texas or Louisiana near natural gas feedstock and include a world-scale steam cracker and derivative units.

Before making final investment decisions, the companies will conduct necessary studies and work with state and local officials to help identify a potential site with adequate infrastructure access.

“We are focused on geographic diversification to supply new markets,” said Yousef Abdullah Al-Benyan, SABIC Vice Chairman/CEO. “The proposed venture would capture competitive feedstock and reinforce Sabic’s strong position in the value chain.”

Neil Chapman, President of ExxonMobil, said: “We have the capability to design a project with a unique set of attributes that would make it competitive globally. That is vitally important as most of the chemical demand growth in the next several decades is anticipated to come from developing economies.”

ExxonMobil and Sabic have worked together for 35 years in major chemical joint ventures in Saudi Arabia, with a rubber/elastomers unit having started up recently. The world-scale speciality elastomers facility at the Al-Jubail Petrochemical Company (KEMYA) has a total investment of US$3.4 billion and the capacity to produce up to 400,000 tonnes/year of rubber including halobutyl, styrene butadiene, polybutadiene, and ethylene propylene diene monomer (EPDM) rubbers, thermoplastic speciality polymers, and carbon black to serve local markets, the Middle East and Asia.

Sabic has said it is targeting North America and other markets to secure feedstock and expand its presence in key markets to fuel its growth as petrochemicals producers in Saudi Arabia are constrained by shortages of gas supplies.

The US shale gas industry has taken a leap in recent years. In fact, last year, Sabic signed its first deal to use US shale gas at its Teesside petrochemical plant in the UK.