JUBAIL — Minister of Energy Prince Abdulaziz bin Salman revealed on Wednesday the intention of the Saudi Basic Industries Corporation (SABIC), in cooperation with Saudi Aramco, to start the first project in Saudi Arabia to convert crude oil into petrochemicals. The project, with a capacity of 400,000 barrels per day, will be established in the city of Ras Al-Khair in the Eastern Province, the minister said in his speech during the opening ceremony of the SABIC building in Jubail. He said the global oil demand would continue growing at a rate of 60 percent over the coming years until 2040. Saudi Aramco and SABIC had signed an agreement to build a complex to convert 45 percent of crude oil into direct chemicals, and awarded a contract to US engineering group KBR for project management, engineering and design. The multi-billion dollar project, the world's largest crude-to-chemicals facility and the first of its kind in Saudi Arabia, will be part of the Saudi government's efforts to diversify an economy that relies on exporting crude oil. By 2030, this complex is expected to become one of the most important projects contributing to the Kingdom's GDP, and will play a pivotal role in supporting efforts to achieve economic diversification and shift from exporting oil to developing high-value industrial products. This project, which is in line with the Kingdom's Vision 2030, will support efforts aimed at developing a more diversified refining, processing and marketing sector in the Kingdom. Prince Abdulaziz said that the system aims to expand the manufacturing petrochemical industry, as well as to increase consumption in the national market of petrochemicals from 15 percent to 40 percent of the total domestic production. "The energy system works to achieve the optimal use of hydrocarbon resources and provide more opportunities to benefit from petroleum liquids in the production of petrochemicals, and also aims to focus on the production of specialized chemicals to support and localize industrial applications," he said. The minister said that the system intends to increase the Kingdom's maximum sustainable production capacity of crude oil, which will contribute to providing additional feedstocks that support the growth of the petrochemical sector. He pointed out that the Oil Demand Sustainability Program seeks to expand and raise the demand for petrochemical products to the global market through its work with several countries, such as India, China, the United Kingdom and others. The minister also spoke about working on developing gas fields to provide opportunities for further expansion in the petrochemical industry, while pointing to the establishment of distinguished projects to localize supply chains and value chains for the components of the energy sector, including the petrochemical sector within the Kingdom. With regard to localization, Prince Abdulaziz said that the petrochemical sector constitutes more than 20 percent of the Saudization targets, as the estimates of the share of local investments related to the localization goals amounted to more than SR50 billion. For his part, Eng. Khalid Al-Dabbagh, chairman of the Board of Directors of SABIC, confirmed that the company's participation coincides with the comprehensive development in the Kingdom under an ambitious and wise vision. He pointed out that the new building represents an important step in SABIC's march towards becoming the preferred global leader in the field of petrochemicals.
