MOSCOW (MRC) -- Sadara Chemical Co. has signed a 20-year supply agreement with Energy Chemicals Sources Co. (ECSC), a new joint venture of Halliburton and The Industrialization & Energy Services Co. (TAQA), to supply feedstock to ECSC's planned chemical production facility to be built in Jubail, Saudi Arabia, as per GV.
Under the agreement, Sadara will supply 60,000 t/y of ethylene oxide and 20,000 t/y propylene oxide via pipeline to the new specialty chemicals complex, which will be located in PlasChem Park. Construction on the facility is planned to begin this year with production expected in the fourth quarter of 2016.
The agreement with ECSC "is a key step forward in the development of the local oil and gas chemicals market," said Sadara Chief Executive Ziad Al-Labban. "Capitalizing on TAQA and Halliburton's combined knowledge and experience, and utilizing the chemicals that Sadara will be producing, we will together support the Kingdom's oil and gas industry through the manufacturing of essential oil and gas chemicals locally," he added.
PlasChem park is being developed under the collaborative efforts of Sadara and the Royal Commission for Jubail and Yanbu. Located next to Sadara's new USD 20-billion petrochemical complex, the park is devoted exclusively to chemical and conversion industries.
As MRC wrote previously, in June 2013, Dow Chemical, an American multinational chemical corporation, announced the signing of the main financing for the Sadara project. Sadara Chemical Company (Sadara), Dow's joint venture with Saudi Aramco, entered into definitive agreements with certain export credit agencies, commercial banks and the Public Investment Fund of the Kingdom of Saudi Arabia for approximately USD10.5 billion of additional project financing.
Sadara is building a world-scale, fully integrated chemicals complex in Jubail Industrial City 2, Kingdom of Saudi Arabia. The complex will be comprised of 26 manufacturing units, will possess flexible cracking capabilities and is expected to produce more than 3 million metric tons of high-value performance plastics and specialty chemical products. The first production units are expected to come on-line in the second half of 2015, with full production starting in mid-2016.