Advanced Petchem, SK Gas to build US$1.8 bn PDH, PP complex in Saudi

Saudi based polypropylene (PP) manufacturer, Advanced Petrochemical Company (APC), and SK Gas, a subsidiary of South Korea’s SK Group, are building a US$1.8 billion (SR 6.75billion) propane dehydrogenation (PDH) and PP complex in Jubail, Saudi Arabia. The facility will have a capacity to produce propylene and PP of 750,000 tonne/year.

Read: Saudi Arabia confirms US$2 bn petchem deals; ties up with global chemical firms

A memorandum of understanding (MoU) has been signed between Advanced Global Investment Company (AGIC) for APC and SK Gasfor the project that will produce value added PP grades to manufacture PP compounds for the automotive industry as well as other specialised grades that are imported into the Kingdom.  The project is expected to start up in the second half of 2024.

According to APC,  it has received propane feedstock allocation from Saudi Arabia’s Ministry of Energy, Industry and Mineral Resources for the project.

The overall project, as per the allocation letter from the ministry, also includes the proposal to set up a 100,000 tonne/year PP compounding unit to cater for the requirements of the potential automotive industry in Saudi Arabia, according to APC.

A portion of the PP output from the PDH unit will also be utilised to set up a 70,000 tonne/year isopropanol (IPA) unit.

It added that the estimated investment costs for the PP Compounding unit and the IPA unit are expected to be US$40 million and US$100million, respectively.

Meanwhile, APC also disclosed of an MOU it signed with SK Gas to conduct a feasibility study on a cracker project in the Kingdom.