NPE ’24: SABIC eyes growth opportunities in Americas amid era of global overcapacity

Al Greenwood

07-May-2024

ORLANDO (ICIS)–SABIC is looking for further opportunities for growth in the Americas as part of its strategy to navigate an era of excess capacity around the world, one that has led it and other producers to shutter capacity in high-cost regions, an executive said.

“We are actively looking at our growth opportunities throughout North America as well as South America,” said Sami Al-Osaimi, executive vice president, polymers, SABIC. He made his comments during a presentation at this year’s NPE: The Plastics Show.

Al-Osaimi said the Americas is a very key strategic market for SABIC. The company has seen good momentum in North America.

“We are definitely going to really make sure that we leverage what exactly our customers require,” he said.

About two years ago, SABIC and ExxonMobil started operations at an integrated polyethylene (PE) and ethylene glycols (EG) complex in Corpus Christi, Texas, US, under the Gulf Coast Growth Ventures (GCGV) joint venture. The startup marks SABIC’s first US-based ethylene and PE production, albeit through a joint venture.

At the same time, Al-Osaimi acknowledged the challenges facing the industry.

The market is contending with the consequences of a surge in new ethylene capacity that has started up in recent years. ICIS estimates that up to 20 million tonnes/year may need to shut down to keep operating rates at healthy levels. High-cost regions are bearing the brunt.

Earlier in April, SABIC announced plans to shut down a cracker in Geleen, the Netherlands.

ExxonMobil revealed plans to shut down its cracker in France during that same week.

Al-Osaimi did not rule out further capacity rationalizations during a question-and-answer session that followed his presentation at NPE.

“SABIC always is looking to its operations in Americas, globally, and how to become more efficient and effective to support our customers to really develop the right solutions,” he said. “This is going to be an ongoing process.”

OPPORTUNITIES IN CHEM RECYCLING, E-CRACKING
SABIC is further improving chemical recycling technology to make it more effective and efficient, he said.

SABIC and Plastic Energy are developing a chemical recycling plant under a joint venture in Geleen. Completion had been expected in the fourth quarter of 2023.

There are still challenges with scaling up the technology, Al-Osaimi said. Still, SABIC is open to expansion, with possible sites including the US, Saudi Arabia and other regions.

In addition, SABIC, BASF and Linde recently started up a demonstration unit of an electric cracker (e-cracker). As the group demonstrates the technology, it would explore expanding the site and potentially building new units, Al-Osaimi said.

STRATEGY OF COLLABORATION, INNOVATION
In prepared remarks, Al-Osaimi elaborated on how SABIC was navigating the challenges in the market by stressing its focus on innovation and collaboration with customers.

The company is focusing on end markets such as advanced packaging, automotive, transportation, building and construction, consumer goods, electrical components and health and hygiene, he said.

Electric vehicles (EVs) have material challenges, that present opportunities for SABIC. The company is developing polymers to prevent thermal runaway – part of its larger BLUEHERO initiative, Al-Osaimi said.

Companies that build automobiles powered by internal combustion engines (ICEs) still want to lower their weight to improve their fuel efficiency and reduce their greenhouse gas emissions, he said. That is creating demand for lighter weigh materials.

Produced by Plastics Industry Association (PLASTICS), NPE: The Plastics Show takes place 6-10 May in Orlando, Florida.

Focus article by Al Greenwood

Thumbnail image shows polyethylene (PE), which is used in plastics bags. (Photo by Elaine Thompson/AP/Shutterstock)

READ MORE

Global News + ICIS Chemical Business (ICB)

See the full picture, with unlimited access to ICIS chemicals news across all markets and regions, plus ICB, the industry-leading magazine for the chemicals industry.

Contact us

Partnering with ICIS unlocks a vision of a future you can trust and achieve. We leverage our unrivalled network of industry experts to deliver a comprehensive market view based on independent and reliable data, insight and analytics.

Contact us to learn how we can support you as you transact today and plan for tomorrow.

READ MORE