Saudi Aramco Review 2019

Sadara ... the cornerstone of Aramco’s downstream strategy

Sadara ... the cornerstone of Aramco’s downstream strategy

Sadara: a new paradigm

The name Sadara means ‘in the lead’ in Arabic. It was chosen to reflect Aramco’s quest for superior performance and becoming the global leader in petrochemicals

 

Sadara is not just another project; it is the cornerstone of Aramco’s downstream strategy to become a leading global integrated energy and chemicals enterprise, continuously increasing the value we deliver from the kingdom’s hydrocarbon resources.

The world’s best partnerships are those in which partners share a vision and complement each other’s strengths to produce something that is truly transformative and extraordinary.

That’s what happened when the company created its powerful partnership with The Dow Chemical Company.

Aramco chose to partner with Dow because of its technical competence in producing high volumes of speciality chemicals. This capability, combined with its refining expertise and ability to produce and leverage high volumes of versatile feedstocks, made the prospect of joining forces very attractive.

Both leaders in their respective industries, they came together through their shared values and vision to create a chemicals production facility that is unrivalled in the industry. The result was the Sadara Chemical Company.

“Sadara represents a bold undertaking for both Saudi Aramco and for Dow. For us at Saudi Aramco, it’s a major driver in achieving our goals of greater integration and value addition. Sadara represents the concrete realisation of our distinct, yet complementary, corporate visions,” says former Saudi Aramco Chairman of the Board of Directors, Khalid A. Al-Falih Al-Falih.

 

LEADING ON THE WORLD STAGE

The name Sadara means ‘in the lead’ in Arabic. It was chosen to reflect Aramco’s quest for progressive leadership, superior performance, and its commitment to becoming the global leader in petrochemicals production.

Sadara’s location, scale, configuration, and product slate would make it a first of its kind in the region and the industry. It would also enable further integration between Aramco’s upstream and downstream operations and enable it to significantly increase our product portfolio and enter the speciality chemicals segment with a compelling offer for customers.

In 2007, Aramco began formulating plans with Dow to build a new, world-scale chemicals complex.

Its proven ability to engineer and bring to completion extreme engineering projects has enabled the growth of our company to become the world’s unprecedented upstream production powerhouse.

Aramco applied that skillset to build Sadara – the world’s largest integrated chemicals complex ever completed in a single phase – and established by the largest foreign direct investment in the Saudi petrochemicals industry.

In 2011, construction began on the $20-billion Sadara mega-project. Located in Jubail Industrial City II on the east coast of Saudi Arabia, the site was chosen because of its strategic access to growing chemicals markets in the region and in Asia.

Plans for Sadara featured 26 integrated world-scale manufacturing plants that could produce more than three million tons of performance plastics and high-value chemicals per year. Of the 26 plants, 14 would be capable of producing specialty chemical products that have never been produced in the kingdom before.

Saudi Aramco knows its greatest opportunities for growth and diversification come from an innovative approach to maximising its resources. So it aims to create extra value from every hydrocarbon molecule it producea through refining and chemical production.

As a result, the firm generates new value streams for itself, sustainable value for its partners, and exceptional products for its customers in the kingdom and the rest of the world.

“Sadara is a flagship chemicals project that significantly advances our ability to derive the maximum value from every hydrocarbon molecule, and to participate more broadly across the petroleum value chain,” says Saudi Aramco president and CEO Amin Nasser.

In 2016, Sadara marked a historic landmark with the startup of its mixed feed steam cracker, making it the first chemicals facility in the GCC countries to crack naphtha. The cracker, which breaks ethane and naphtha to form new molecules, including ethylene and propylene, enables the production of a diversified range of plastics and chemical products designed to meet the rigorous standards of sectors such as advanced packaging, construction, electronics, furniture, and the automobile industry. 

In another first for the Gulf region, Sadara produces toluene diisocyanate (TDI). TDI is mainly used in the production of flexible polyurethane foam for furniture, mattresses, cushioning, and car seats. TDI also has a variety of industrial uses, such as coatings, adhesives, sealants, speciality foams, and other products.

Sadara’s full value will be seen in an economic ripple effect of industrial clusters, value parks, and the development of the knowledge-based research, engineering, and service firms to support them.

While Sadara itself currently employs more than 4,000 people, it is expected to also create economic opportunities in associated manufacturing and service businesses that will generate additional jobs in the Jubail area.

“With leading-edge technologies, a differentiated product slate, and the unique concept of PlasChem Park, we are well on our way to becoming a ‘game-changer’ in the chemical industry, creating value through chemistry and contributing to the growth of downstream manufacturing and economic diversification of the kingdom,” says Nasser.

Another powerful partnership, this time between Sadara and the Royal Commission for Jubail and Yanbu’, has given Aramco the ability to build the PlasChem conversion park — one of the keys to realising the full value of the Sadara complex.

The 12-sq km PlasChem park site in Jubail Industrial City II is located next to Sadara’s new manufacturing complex. It will be devoted exclusively to chemical and conversion industries that make direct or indirect use of Sadara’s products, as well as raw materials from other suppliers. The site will have two main sections: the Chemical Park and the Conversion Park.

By offering the advantages of easy access to Sadara’s highly differentiated chemical products and the strong industrial and regulatory infrastructure in Jubail, PlasChem provides the ability to convert feedstock into high-value finished products.

The Sadara Chemical Company represents what is possible when two partners come together to create a vehicle for generating more value for their customers, partners, and their respective companies. Sadara stands as a tangible example of the power of vision and collaboration.




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