SABIC sees ‘astonishing’ growth in China

21 September 2010 23:25  [Source: ICIS news]

By Joseph Chang

NEW YORK (ICIS)--Saudi Arabia’s SABIC sees “astonishing” polymers growth in China in the years ahead and is positioning to take advantage of this opportunity, a senior executive said on Tuesday.

“China consumes more plastic than any other country in the world - there is astonishing growth there,” said Khaled Al-Mana, vice president of polymers at SABIC.

“China is the factory of the world and polymer demand growth should be higher than GDP [gross domestic product] levels, growing at between 6-14%/year, depending on the product,” he added.

SABIC started up its joint venture (JV) with Chinese petrochemical major Sinopec in Tianjin in January and began commercial production in May.

“We are happy with the start-up and are now getting close to full capacity,” said Al-Mana.

The Tianjin plant has total capacity of 4m tonnes of chemicals and polymers, with 1m tonnes of polymer capacity, he noted. It includes a 1m tonne/year naphtha cracker.

SABIC also has marketing rights to the polymers output of the Fujian Integrated Refining and Ethylene Joint Venture Project (FREP) in Quanzhou in Fujian province. The FREP is jointly owned by Fujian Petrochemical (50%), ExxonMobil China Petroleum and Petrochemical (25%) and Saudi Aramco Sino (25%).

“We now have a more direct involvement in Asian petrochemical and polymers market with the JV production and the marketing rights,” said Al-Mana.

“From China, we also expect to ship polymers to other southeast Asian countries such as Indonesia and Vietnam,” he added.

Al-Mana would not say whether SABIC is considering additional investment opportunities or joint ventures in China.

“We want to be the partner of choice, and are open to any opportunity that makes economic sense,” he said.

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