SABIC, Sinopec break ground on US$1.7B polycarbonate production complex with annual capacity of 260,000 tonnes in Tianjin, China; site expected to be operational in 2015

JUBAIL, Saudi Arabia , April 3, 2012 (press release) – Sinopec SABIC Tianjin Petrochemical Company (SSTPC) laid the foundation for a polycarbonate production complex with 260,000 metric tons per annum capacity, at a ground-breaking ceremony in the Tianjin Binhai New Area. Previously, China Petroleum & Chemical Corporation (Sinopec) and Saudi Basic Industries Corporation (SABIC) had cooperated on an ethylene production project with a capacity of one million metric tonnes per annum.

The ceremony was officiated by His Highness Prince Saud bin Abdullah bin Thenayan Al-Saud, Chairman of Royal Commission Jubail and Yanbu, and Chairman of SABIC; Zhang Gaoli, Member of the Political Bureau of the CPC Central Committee, Tianjin Party Secretary; Huang Xingguo, Tianjin Deputy Party Secretary, Tianjin Mayor; Mohamed Al-Mady, SABIC Vice Chairman and CEO; He Lifeng, Tianjin Deputy Party Secretary, Secretary of Binhai New Area; Yang Dongliang, Member of Tianjin Municipal Standing Committee, Tianjin Executive Vice Mayor; Fu Chengyu, Chairman of Sinopec; Wang Tianpu, Vice Chairman and President of Sinopec; Dai Houliang, Senior Vice President of Sinopec.

Incepted in October 2009, SSTPC is a joint venture with SINOPEC and SABIC each holding 50 percent equity. The Phase One project, with annual capacity of one million metric tonnes of ethylene, has begun production since January 2010. With a total investment of RMB11 billion (USD 1.7 billion) and covering a ground area of 67 hectares, this polycarbonate production complex with an annual capacity of 260,000 metric tonnes is the Phase Two project and was approved by China’s National Development and Reform Commission (NDRC) on 13 January 2012. With two sets of phosgene free production systems, with an annual capacity of 130 kilo metric tonnes each, to be built, the new polycarbonate production complex will start construction on 3 April 2012 and is expected to be operational in 2015. Upon operation, it can produce four major classes of polycarbonate, including the mixed grade, extrusion grade, optical grade, and molding grade polycarbonate. The project uses the world's leading non-phosgene polycarbonate manufacturing technology, which complies with China’s national energy saving and carbon emission policy. With the advanced equipment, the products are designed to be high tech and high value-added which can be used for a wide range of applications. Hence, it will play an important role in promoting the development of Tianjin petrochemical industry and drive the economic growth in the Bohai rim region, which can effectively meet the market demand of petrochemicals in Asia-Pacific.

Huang Xingguo said at the event: “This is another big project following the Tianjin one million metric tonnes of ethylene and the ten million metric tonnes of oil refining projects by Sinopec and SABIC. It deepens the cooperation between China and Saudi Arabia, and accelerates the development of Binhai New Area and is strategically important for the construction of state-level petrochemical industry base. We will put full effort to provide quality services and create the environment to safeguard the smooth project implementation. ”

Fu Chengyu added: “This project is the fruitful result of the cooperation between Sinopec and SABIC. It is also an important move for Sinopec to adjust our product mix, to elevate our target product market, and to expedite the change of the ways of economic developments. The construction of the complex will further enhance the competitiveness and lead China’s way in the petrochemical sector. It also brings both parties to form a closer tie in strategic cooperation, as well as to tighten the bilateral relations between China and Saudi Arabia. Both parties are committed to strive for efficiency, excellence, safety and environmental-friendliness in the project.”

Prince Saud remarked: “Today’s ground-breaking ceremony is an important milestone for SABIC. It marks another collaboration we have with Sinopec, and our closer connection with the Chinese people. SABIC and Sinopec have shared ambitions of establishing long-term strategic partnership that contributes towards enriching the economies of Saudi Arabia and China in the areas of scientific research, technology, reform and product marketing.”

Demand growth for polycarbonate is the fastest among the top five engineering plastics. Polycarbonate has high purity and transparency properties. With its excellent overall performance, it is widely used in automotive parts, home appliances, medical products, etc. With the recent growth in industries such as electronics, automotive, information technology and building materials, there is a significant increase in China in the demand of polycarbonate and other engineering plastics. In 2010, China consumed 1.13 million metric tonnes of polycarbonate, with a domestic output of 220,000 metric tonnes only. China mainly relies on imports for polycarbonate, and hence, polycarbonate was the highest by volume of import among all engineering plastics. Based on initial estimation, demand for polycarbonate in China will reach 1.78 million metric tonnes by 2015, an average annual increase of nearly 10%.

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