12 May 2010 21:04 [Source: ICIS news]
NEW YORK (ICIS news)--Saudi petrochemical major SABIC is fully committed to the growth of its engineering thermoplastics business, SABIC Innovative Plastics (SABIC IP), the CEO of the subsidiary said on Wednesday.
“We're a part of a very powerful petrochemicals company that continues to invest in the petrochemicals industry,” said Charlie Crew, president, CEO and chairman of the management board of the US-based company.
Crew told ICIS. “So there's a strategic view at SABIC of what we need to be as a company and that now includes high-performance specialty plastics.”
SABIC acquired the business, formerly GE Plastics, from GE in 2007.
“That translates to a strong commitment to the plastics business, which quite frankly we didn't have with our former owner, because it didn't really fit the strategic model of GE,” Crew explained. “It fits perfectly into the strategic model at SABIC.”
SABIC IP is not feedstock-advantaged by its relationship with SABIC, he said. When SABIC does supply feedstocks, they are bought at market price, he noted.
Also, SABIC is primarily involved in the ethylene chain, owing to its position in natural gas, whereas SABIC IP uses many feedstocks derived from naphtha, an area where SABIC has a relatively small presence.
“Eventually SABIC will look at expansion in some of these chemicals because now they have an internal customer they can sell to,” Crew said.
“Currently we really don't buy a lot from SABIC,” he added. “That benefit is a little bit misunderstood, because it's really not there.”
Instead, the advantage of the relationship lay in SABIC’s vision, resources and commitment, Crew said.
“We're part of a company that's looking to do more of what I'd call specialty materials and to reach global markets,” he said. “SABIC is looking to globalise their business, to reach specialty spaces, and we fit that very nicely.”
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