Jubail & Yanbu Review

Sabic ... teaming up with Aramco for the OTC project

Sabic ... teaming up with Aramco for the OTC project

Aramco, Sabic sign up KBR for $20-billion OTC project

The planned chemicals complex, which will be integrated with the existing refinery in the industrial city of Yanbu, is set to process 400,000 barrels per day of oil into around 9 million tonnes of chemicals and base oils annually



Saudi Aramco and Sabic, partners in a planned oil to chemicals project says to be the worlds biggest, have awarded the US engineering firm KBR a project management contract to develop the scheme, the companies say.

"With the addition of KBR to the project, Saudi Aramco and Sabic are confident that the right parties are now in place to see the project through its initial phases and the inclusion of a high proportion of local content," says Aramco chief executive and president Amin Nasser.

Aramco, the world’s largest oil exporter, and Sabic, the Middle East’s biggest chemicals firm, signed an agreement in November to build a $20 billion oil-to-chemicals facility on the country’s western Red Sea Coast. The scheme comes amid plans by Aramco to boost profitability from the sale of products besides crude.

The planned chemicals complex, which will be integrated with the existing refinery in the industrial city of Yanbu, is set to process 400,000 barrels per day of oil into around 9 million tonnes of chemicals and base oils annually.

KBR will undertake project management and front-end engineering and design. Aramco and Sabic awarded British contracting company Wood Group the schemes first management and design contract in March.

The joint developers of the scheme says last year a final investment decision on the project will be taken after the completion of initial studies.

The project, which Aramco has targeted for completion by 2025, is in line with a trend by regional national oil companies to diversify their downstream industry through development of integrated complexes at home and abroad.

Earlier, Saudi Aramco signed an agreement to develop a $44 billion integrated refining and petrochemicals complex in western India, its first foray in the large South Asian consuming market. The planned scheme is set to have refining and chemical capacities for 1.2 million barrels of crude and around 18 million tonnes of products annually.

The company also inked a $5 billion deal with French oil major Total to develop a huge chemicals complex adjacent to their existing 440,000 bpd refinery in the eastern industrial city of Jubail.

The project will have a mixed-feed steam cracker with 1.5 million tonne capacity to produce ethylene.

Saudi Arabia’s increasing pivot to products from its earlier focus on selling more barrels of oil is also mirrored by the regions fourth-largest producer UAE, whose state-backed Abu Dhabi National Oil Company is set to announce its downstream strategy in May.




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