Sabic to expand petrochemical capacities in USA
The Ryadh-based Saudi Basic Industries Corporation (Sabic), may join BASF, ChevronPhillips, Dow Chemical (Dow), Enterprise Products Partners (Enterprise), ExxonMobil, Evonik, Occidental Petroleum, Sasol, Shell, to increase its petrochemical foot print in USA to benefit from the low costs feedstock provided by the shale gas.
Speaking at the Gulf Petrochemicals and Chemicals Association (GPCA) Forum in Dubai on November 28th, 2012, Mohamed Al-Mady, Sabic CEO and Chairman of the GPCA, recognized the shale gas as a game changer for the global petrochemical industry.
Until then, the main competitive advantage of the petrochemical companies home-based in the Gulf was relying on the lowest costs of the feedstock.
In parallel in USA, the petrochemicals projects planned by ChevronPhillips, Dow, Enterprise, ExxonMobil, Evonik, Sasol and Shell represent $33 billion capital expenditure (source: Project Smart explorer)
In the Gulf, Sabic success will rely on innovation
Sabic is already active in USA through its business unit Innovative Plastics (ex GE Plastics) but wants also to be part of this economical revolution in increasing its foot print either by acquisition, either by joint venture.
In addition to the gas price, Mohamed Al-Mady highlighted also the fact that in USA, the producer and the consumer are on the same market with good infrastructures in between, while the Middle East is mainly exporting to Asia.
In this context, the success of this sector in the Middle-East passes by technology and innovation to increase the added value with new products and improve the manufacturing processes.