Saudi Basic Industries Corp., or SABIC, has entered into a joint venture with China's state-owned Sinopec to produce polycarbonate in Tianjin, China, said its Innovative Plastics executive vice-president Charlie Crew Tuesday.
Crew, alongside the company's vice-chairman and CEO, Mohamed Al-Mady, made the announcement at a press conference on the sidelines of the 25th International Exhibition on Plastics and Rubber Industries, more commonly known as Chinaplas 2011, in Guangzhou, China.
The new facility will be is able to produce 260,000 mt/year of the material and will be housed at the Sinopec-SABIC Tianjin Petrochemical Company, or SSTPC, complex. The company aims to start up the plant by 2015.
Al-Mady said the plant will cost about "$1 billion plus." This will be in addition to the $2.5 billion investment in the current Tianjin complex.
"We are happy with our relationship with our partners," said Al-Mady on why SABIC chose Sinopec as its JV partner.
In an interview with Platts after the news conference, Al-Mady added that the JV was "adding value" to its supply chain as SSTPC already produces the feedstocks for polycarbonate.
"We produce cumene and phenol," said Al-Mady. "So with a polycarbonate plant, we are now fully integrated with our compounding facilities."
The decision to expand the company's current JV also helps save "fixed costs," as SABIC is able to build the new polycarbonate plant on the same site, said Al-Mady. "We can remain competitive."
