RIYADH, 14 May 2007 — Saudi International Petrochemical Company, (Sipchem) has embarked on a SR7 billion Acetyls Projects Complex, which will start initial production in early 2009, Abdulaziz ibn Abdullah Al-Zamil, the company’s chairman of the board of directors, told newsmen here on Saturday.
The press briefing, held following Sipchem’s 8th ordinary general assembly meeting and 4th extraordinary general assembly, was also attended by Eng. Ahmed Abdulaziz Al-Ohali, Sipchem’s CEO.
“This is the second phase of our project which would consist of three plants such as acetic acid (AA), vinyl acetate monomer (VAM) and carbon monoxide,” Al-Zamil said, adding that the raw materials for production will be derived from the company’s methanol plant which was commissioned during its first phase.
The total production of AA and VAM by International Acetyl Company (IAC) and International Vinyl Acetate Company (IVAC), respectively, will amount to 800,000 TPY. Technology licensing agreements for these facilities were secured from Eastman Chemicals for the production of acetic acid and with DuPont for the production of vinyl acetate monomer. Fluor Corp. is the main contractor for the two Acetyls plants providing engineering, procurement and construction management services.
The site construction of the carbon monoxide plant that is an integral part of the Acetyls Complex has already been started by Lurgi AG (Germany) in January 2007, while the construction work for the other two plants commenced in April, Al-Zamil said. “We plan to start commercial operation beginning 2009 and hope to export 70 percent of our production and the balance will be diverted into the local market.” The Acetyls Complex will open great opportunities for new downstream manufacturing in the region providing more than 400 job opportunities.
Al-Zamil pointed out that the shareholders at the extraordinary general assembly had agreed to raise Sipchem’s capital through capitalizing a portion of the company’s dividends. “Under this arrangement, one bonus share was granted to each three share holdings. In this manner, company’s capital will be raised by 33 percent — from SR1.5 billion to SR 2 billion.” Accordingly, the number of shares has been raised by 33 percent, from 150 million to 200 million shares. Shareholders entitled to these bonus shares will be shareholders registered in the company’s register of shares at the Securities Deposit Center, he said.
He also explained that recent fall in prices on methanol, one of Sipchem’s products, may have an impact on the company’s profit margin in the coming months, but it will not have serious effects. Al-Ohali said Sipchem’s methanol and butendiol plants continue their production operations according to schedule and their products are being exported to the global markets in a smooth manner. Sipchem has completed preliminary studies for the third phase and plans for the construction of a world class complex for the production of olefins and their derivatives in Jubail. It will be built in partnership with certain international companies and will consist of 16 plants, with an estimated cost of over SR30 billion.
During the first quarter of 2007, Sipchem realized a net profit of SR150 million, up 54.6 percent over the same period last year, he added.
