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The agreed plan is to establish world-scale plants with capacities of 200,000 metric tons annually of AN and 40,000 metric tons annually of NaCN at one of the SABIC affiliates’ sites in Jubail Industrial City, Saudi Arabia.
Saudi Basic Industries Corporation (SABIC), Asahi Kasei Chemicals Corporation and Mitsubishi Corporation signed a strategic Joint Venture (JV) Agreement on the 27th of April 2011 to form a limited liability company, Saudi Japanese Acrylonitrile Company (SHROUQ), in Saudi Arabia. The company will build a plant for the manufacturing of Acrylonitrile (AN) and Sodium Cyanide (NaCN), with subsequent sales and distribution to be carried by the partners.
Mohamed Al-Mady, SABIC Vice Chairman and CEO, said: "A key driver for the project is Saudi Arabia’s National Industrial Clusters Development Program aimed at growing and diversifying the Kingdom's manufacturing sector. He also noted that “AN and NaCN are very important chemicals for the downstream diversification into Acrylonitrile Butadiene Styrene (ABS), Carbon Fiber, Acrylic Fiber, Acrylamide and others which serve various industries such as automotive, construction, water treatment, oil recovery, personal care, consumer goods, pharmaceuticals, electronics, gold mining and many others. “In particular NaCN will support the local mining industry in Saudi Arabia,” he said.
The Asahi Kasei Group has identified AN operations as a focus for global expansion through strategic investment of management resources with the aim of gaining the number one position in the global AN market. Asahi also states in its official statement that solid demand growth for AN is forecasted to continue worldwide and that Asahi Kasei Chemicals had been considering the construction of a new AN plant to meet rising demand in the Middle East and North Africa. The Asahi Kasei Group commented that the new capacity, joined with their other production in Japan and Korea, will make them the largest producer of AN in the world at some 1.4 million tons per year upon completion of the new plant in Saudi Arabia.
The three partners moved forward with studies and negotiations based on the desire to address the growing demands in the region and globally with the establishment of a joint AN project in Saudi Arabia with superior cost-competitiveness. Under today’s agreement, the three partners will now begin formulating the basic engineering design and perform advance work on a detailed business plan. Leading world-class AN and NaCN technology, global network, established infrastructure and feedstock resources are the strengths that SABIC and the partners bring to the JV.
The partners are targeting the development of a globally competitive project with best-in-class industrial performance. The project will also focus carrying out all necessary details for the JV incorporation and project evaluation, implementation and execution activities with final decision on capital expenditure during 2012.
Saudi Basic Industries Corporation (SABIC) ranks among the world’s top petrochemical companies. The company is among the world’s market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilizers.
SABIC recorded a net profit of SR 21.5 billion (US$ 5.73 billion) in 2010. Sales revenues for 2010 totalled SR 152 billion (US$ 40.5 billion). Total assets stood at SR 317.6 billion (US$ 84.5 billion) at the end of 2010.
SABIC’s businesses are grouped into Chemicals, Polymers, Performance Chemicals, Fertilizers, Metals and Innovative Plastics. SABIC has significant research resources with 18 dedicated Technology & Innovation facilities in Saudi Arabia, the USA, the Netherlands, Spain, Japan, India and China. The company operates in more than 40 countries across the world with 33,000 employees worldwide.
SABIC manufactures on a global scale in Saudi Arabia, the Americas, Europe and Asia Pacific. SABIC’s overall production has increased from 35 million metric tons in 2001 to 66.8 million metric tons in 2010.
Headquartered in Riyadh, SABIC was founded in 1976 when the Saudi Arabian Government decided to use the hydrocarbon gases associated with its oil production as the principal feedstock for production of chemicals, polymers and fertilizers. The Saudi Arabian Government owns 70 percent of SABIC shares with the remaining 30 percent held by private investors in Saudi Arabia and other Gulf Cooperation Council countries.
The company will be known as Saudi Japanese Acrylonitrile Company (SHROUQ) and will be located at Al-Jubail, Saudi Arabia. SABIC will own 50 percent of the venture and Asahi Kasei Chemicals and Mitsubishi with together own 50 percent. Initial paid-in capital will amount to SR 40 million (approximately Y 1 billion, or US$ 10.7 million). The hydrogen cyanide by-product of AN production will be used as feedstock at the NaCN plant to be constructed adjacently.
More information: www.sabic.com