Failing agreement through direct negotiations, a dispute has culminated into litigation between SABIC and one of the major engineering contractors in the world, which is executing several giant projects for SABIC.
The Grievances Board has begun tackling the case brought up before it by and between SABIC and TOYO, Japan. The case involves pecuniary claims in hundreds of millions dollars, arising as a result of TOYO’s construction of a petrochemical complex in Jubail which belongs to Petrokemya, a wholly-owned subsidiary of SABIC.
Accomplished two years ago, the complex operates at a production capacity that, at times, reached 120%. The complex ranks as one of SABIC’s most successful projects, both in terms of its production capacity and revenues and profits.
Close sources have indicated that TOYO is raising claims against SABIC for arrears of the value of the contract signed between the parties, in addition to other huge compensations for certain aspects of the complex on which no settlement was reached between the parties; hence the resort to legal proceedings.
It is noteworthy that SABIC, last year, sustained a loss in a judicial confrontation with Exxon Mobil that took place following their failure to reach a settlement. The final verdict obligated SABIC to pay compensation to Exxon Mobil in the sum of SR1.5 billion, which is viewed to be the biggest compensation in this connection.
