Saudi Company SABIC Partners with the Chinese FJPEC for a Mega Petrochemical Venture in China
- 03-Sep-2021 5:00 PM
- Journalist: Harold Finch
Saudi Basic Industries Corporation (SABIC) has signed a USD 6 billion investment pact with the Chinese company Fujian Petrochemical Industrial Group Company (FJPEC) for building a major petrochemical facility at Gulei Industrial Park in Zhangzhou.
The plan came into effect after SABIC signed an MOU with the Fujian provincial government in September 2018 to construct a petrochemical complex in south-eastern China. The Zhangzhou petrochemical complex is proposed to be equipped with the state-of-the-art mixed feed steam cracker designed to render ethylene production of 1500 KTPA. The complex will also boast key downstream process technologies comprising of one monoethylene glycol (MEG) production unit, two polypropylene units, two polyethylene units, and one polycarbonate unit.
SABIC is a subsidiary company of the state-owned Saudi Aramco that is focussed on the manufacture of polymers, petrochemicals, fertilizers and speciality chemicals. Ranking among the largest producers and traders of petrochemicals, SABIC has operation facilities spanning across 50 countries.
Petrochemical products, with their wide use in households, packaging, fertilizers, medical equipment, electronic appliances, are rooted in the modern structures of society. Ethylene, derived from the cracking of natural gas and oil feedstocks, is a major petrochemical product with a diverse portfolio. Ethylene is used as the precursor to many downstream derivatives like glycols, olefins, polymeric resins that serve the end-use industries like building and construction, packaging, automotive, textile and agrochemicals.
According to ChemAnalyst market analysis, the global demand for ethylene and its derivatives is anticipated to grow with a CAGR of around 6% by the next 5 years owing to their diverse applications. With China having the largest market share for ethylene, the proposed joint venture will aid in fulfilling the demand and strengthening the country’s petrochemical sector.
As per ChemAnalyst – “The petrochemical sector is still under the revival stage after the enduring tight feedstock supplies and disrupted transportation due to COVID19. The addition of capacities will facilitate generous supplies to the end-use industries. However, implementation of strict regulatory laws on ethylene production and usage may pose a threat to its steady growth.”