- Saudi Basic Industries Corp. (SABIC) has greenlit a $6.4 billion investment for a petrochemical complex in Fujian, strengthening its partnership with China. Developed in collaboration with Fujian Fuhua Gulei Petrochemical Co., the project is set to commence construction in H1 2024, with commissioning and start-up preparations starting in H2 2026, lasting six months. The complex aims to begin commercial production by H1 2027, with SABIC Industrial Investment Co., a wholly-owned subsidiary, holding a 51% ownership stake, and the Chinese entity owning 49%.
- Initially proposed in 2018, the project gained momentum with the signing of a memorandum of understanding with Fujian province in China, outlining the cooperative framework. The facility includes a mixed-feed steam cracker with an annual ethylene capacity of up to 1.8 million tons, along with downstream facilities for ethylene glycols, polyethylene, polypropylene, polycarbonate, and more, incorporating nine technologies from SABIC. Financial results are expected post-commercial production completion in H1 2027, aligning with SABIC's goal to diversify feedstock sources and expand its manufacturing presence in Asia.
Why it matters
The financing, through a combination of debt and company cash flows, follows a series of investments by Saudi Aramco in China's downstream sector. Earlier in January, Aramco and Chinese refiner Rongsheng Petrochemical revealed talks to acquire a 50% stake in each other's refineries, building on Aramco's strategy in the Chinese market.
