Business | Oil & Gas
Aramco continues talks with Dow on chemical plant
Saudi Aramco, the national oil company of Saudi Arabia, is seeking partnership with America's Dow Chemical Company for the construction of a petrochemical complex at Ras Tanura.
- By Mariam Al Hakeem, Correspondent
- Published: 00:00 January 30, 2007
Riyadh: Saudi Aramco, the national oil company of Saudi Arabia, is seeking partnership with America's Dow Chemical Company for the construction of a petrochemical complex at Ras Tanura.
A delegation from Saudi Aramco is currently negotiating the project with the American company.
Ras Tanura, the world's largest petroleum port, is located in the eastern region of the kingdom, north of Dhahran.
A Saudi Aramco official told Gulf News if the two companies reach an agreement, they would set up a new unit that will be named Ras Tanura Petrochemicals Company.
The unit will be established with an estimated capital investment of more than $15 billion. The project will involve the biggest investment for Saudi Aramco in this sector and the second after its partnership with Somitomo.
Incidentally, Saudi Aramco does not include the cost of the project in its $80 billion oil and refinery investments for the coming five years.
"No agreement has been reached yet, but all options are in favour of the final agreement or looking for another partner in case the negotiations reached a deadlock," the source said yesterday.
Sources said the Saudi company is looking forward to start execution of the project any time between 2008-09 and begin production in 2011.
Negotiations between Saudi Aramco and Dow Chemical began in the final quarter of 2006. The plan is to enter into a partnership agreement for the construction and operation of a state-of-the-art complex for petrochemicals and plastic products in Ras Tanura.
The project includes a range of advanced utilities for the production of chemicals and plastic products.
Aramco claims the new petrochemicals project is the largest of its kind in the world. Industrial reports say that the manufacturing of such products would help in setting up manufacturing industries in Saudi Arabia to boost the kingdom's industrial base.
Dow Chemical produces a wide range of products for its clients in 175 countries around the world. Its annual sales reached $ 46 billion last year.
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