RIYADH, 19 November 2006 — Saudi International Petrochemical Co. (Sipchem) has declared that it will go ahead with the construction of its acetic acid and vinyl acetate monomer plants in Jubail despite the case filed against it by Celanese Corp. of the US seeking to block three petrochemical companies from manufacturing the products. Speaking from the Eastern Province, Ahmed Al-Ohali, president of Sipchem, said the basis for Celanese’s lawsuit against them was false since they were using a different technology. The Sipchem president said, “Our business is basic clean business ethics. Our technology is totally non-Celanese. We are not using any Celanese papers, trade secrets or documents. What is bothering them is that we have proved to be successful in our business.”
Regarding the technology, he said they were using Eastman’s for their acetic acid plant which will have a capacity of 460,000 tons per annum, while the vinyl acetate monomer plant (300,000 tons per annum) will rely on Du Pont’s technology.
Sipchem recently went public by issuing 45 million shares equal to 30 percent of its capital. Sipchem’s initial public offering (IPO), which was floated from Sept. 9 to 18, was said to be the second largest offering in the Saudi market in the past three years.
In an announcement released from Texas, Celanese Corp. said it had sued Sipchem and two other chemical companies for what it called “violation of trade secrets.” Celanese said it is seeking to block Sipchem, International Acetyls Co. and International Vinyl Acetate Co. from building their vinyl acetate monomer and acetic acid plants in Al Jubail. Celanese alleges that the companies hired its former employees and suppliers “with intimate knowledge of Celanese’s trade secrets.”
Acetic acid is used to make vinyl acetate monomer, a chemical found in paints, coatings and packaging materials. Sipchem announced that it had commenced construction works for building the acetyls complex, which consists of three plants: the Acetic Acid plant (460,000 tons per annum), the vinyl acetate monomer plant (300,000 tons per annum) and the carbon monoxide plant (345,000 tons per annum) in addition to the utilities and offsite facilities at King Fahd Industrial Seaport in Jubail.
This complex will be located at Sipchem`s site in the industrial city of Jubail. The complex will start commercial operation in early 2009. Being the first of its kind in the Middle East, this complex will be in line with Sipchem`s vision of investment in value-added petrochemical projects that would realize optimal returns for the shareholders. This SR4-billion project represents the second phase of Sipchem`s projects.
According to Al-Ohali, this project would create over 500 direct job openings. Sipchem has recruited more than 100 young Saudi high school graduates who are now undergoing training at specialized pre-service training centers and will join the projects` working team after graduation. He added that products of the new complex would open up a wide scope for various other processing industries in the Kingdom.