KSA Petrochemical Sector

The sector today is driven by either proximity-to-market or large-scale projects, which take advantage of low-cost, secure oil supplies. This makes the Kingdom of Saudi Arabia one of the world’s strategic hubs for petrochemical expansion. These competitive advantages are now likely to be joined by a number of highly integrated refining and petrochemical investments, which will develop and strengthen the industry throughout the Kingdom.

Overall, the Kingdom’s strong infrastructure, significant cost advantage due to lower average variable and fixed cost and the competitive and fixed natural gas prices render it an attractive destination for investments in crackers of Olefins and derivatives. Moreover, the Kingdom’s energy strategy promotes diversification into downstream and the development of export-oriented plastic conversion industries resulting in further opportunities.

A Few Facts and Figures:

• The sector is expected to witness investments of over US$180bn between 2008 -2012!
• One Quarter of all global Ethylene capacity development by 2011 to be found in the Kingdom
• In the next 5 years Saudi Based Manufactures alone are predicted to double the current 1 million tonnes-a-year of polymers they currently convert
• Overall, Saudi Arabia is the 11th largest supplier of Petrochemicals
• Saudi Arabia produces 7-8% of the world’s supply of Petrochemicals, which is planned to rise to 13-14% by 2010.

• Use of local feedstocks especially Natural Gas
• Joint ventures with major oil and chemical companies
• World scale plants utilizing latest technologies
• Large scale production of upstream petrochemicals, mainly ethylene derivatives based on ethane crackers
• Export oriented industry: More than two-thirds of SABIC's petrochemical products are exported and more than half of these exports are destined to the high-speed growth markets of the Far East and South East Asia.