Celanese withdraws from talks on Saudi acetyls project

13 December 2005 19:47  [Source: ICIS news]

NEW YORK (ICIS news)--Celanese Corp said on Tuesday it has halted discussions with Tasnee Petrochemicals regarding an acetyls project in Saudi Arabia because of the strong demand for vendors and contractors in the region.

“Trying to get contractors to even bid on projects is a problem right now,” said Dave Weidman, president and chief executive of Celanese. “The climate is overheated right now with too many projects and too few engineers and contractors,” added John O’Dwyer, acetyls president for Celanese.

Celanese had been attracted to Saudi Arabia as a platform for acetyls production because of favorable raw material prices, especially natural gas costs below $1/m Btu. However, capital costs associated with the project and potential delays because of the manpower shortage would have more than negated the raw material advantage, according to O’Dwyer.

Celanese plans to reassess its plans for Saudi Arabia at a later date, but O’Dwyer said it was unlikely the company would begin building before 2010.

By: Robert Brown
+1 713 525 2653

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