Dow partners with Saudi Aramco to form new petrochemical supplier

The Dow Chemical Company has entered into a joint venture with Saudi Arabia’s state-owned oil and petrochemicals giant Saudi Arabian Oil Company – or Saudi Aramco – to create a new global petrochemical supplier called the Sadara Chemical Company.

The company will be housed in a new complex currently being built in Jubail Industrial City, Saudi Arabia, which is said will be one of the world’s largest integrated petrochemical facilities.

The companies expect Sadara’s first production plants to start up in the second half of 2015, with all units due up and running in 2016. Manufacturing units within the complex will produce a range of performance products, including polyurethanes, propylene glycol, elastomers, linear low density polyethylene, low density PE, glycol ethers and amines.

According to a joint Dow Chemical/Saudi Aramco press release, Sadara will market products to markets in the Middle Eastern countries, while Dow will market and sell on behalf of Sadara to the rest of the world.

“Sadara is poised to become a significant contributor for Saudi Aramco’s transformational downstream growth strategy,” said Saudi Aramco president and CEO Khalid Al-Falih. “This unique partnership will help foster downstream industries and support industrial diversification that add significant value to the Kingdom’s hydrocarbon resources.”  

According to the press release, Sadara is expected to deliver revenues of about US$10 billion annually in its first few years of operation.

The Sadara project is Aramco’s second major investment in a large-scale petrochemical complex in the Kingdom, where it is already involved in a joint venture with Sumitomo Chemical Co.