Al-Jubail is 'interesting alternative' for Dow JV - Liveris

28 April 2010 16:57  [Source: ICIS news]

Dow headquartersHOUSTON (ICIS news)--Al-Jubail is an "interesting alternative" to Ras Tanura for the huge petrochemical complex that Dow Chemical and Saudi Aramco are planning in Saudi Arabia, Dow CEO Andrew Liveris said on Wednesday.

However, the joint venture had made no decision on whether it would move the project, although "Jubail has been assessed as an interesting alternative", said Liveris, who made his comments during an earnings conference call.

Sources close to the project had told ICIS that the companies were reconfiguring the joint venture's planned petrochemicals project, as they planned to move it to Al-Jubail from the earlier proposed site at Ras Tanura.

The joint venture was moving the project because of cost pressures, since Al-Jubail was more developed than Ras Tanura, sources said.

In addition, the project had been downsized, with expectations that it would have one cracker instead of two, according to sources.

During the conference call, Liveris did not address the reports of downsizing.

However, he did acknowledge that Dow and Saudi Aramco had been examining the capital burden of the project.

"We have made no decision yet on any move, although Jubail has been assessed as an interesting alternative that has been made available to the partners," Liveris said.

"We are basically within a few months of making final decisions on the feed, " Liveris said.

Sources suggested to ICIS that the revised project at Al-Jubail was likely to be based on a naphtha/ethane mix.

Liveris said that the decision on the feedstock "is obviously the big commitment to go to the next step or to long-term equipment and in fact start detailed design and in fact start site prep".

"We will have a lot to say," he said. "Give us a few months."

Dow and Saudi Aramco signed a detailed memorandum of understanding in May 2007 to construct and operate the Ras Tanura project.

They said the project would involve 30 worldscale petrochemical plants, which would have the capacity to produce 4m tonnes/year of upstream products and 7m tonnes/year of downstream products.

Earlier this year, Dow was estimating that the project could come on stream in 2014 or 2015. With the move to Al-Jubail and the change in the project’s scope, the timing was expected to slip by several months, according to an engineering official. 

The original project would have been integrated with Saudi Aramco’s Ras Tanura refinery and received a mixed feed of naphtha and ethane.

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