Saudi-based Rufayah Chemicals Company (RCC), a Saudi downstream company, has signed a deal with Sadara Chemical Company for setting up one of the largest hydrocarbon resin plants in the world at an investment of $500 million in the PlasChem Park, a 12-sq-km industrial park at Jubail in Saudi Arabia’s Eastern Province.
Sadara, a joint venture between Saudi Arabian Oil Company (Saudi Aramco) and The Dow Chemical Company, is building the world-scale chemical complex with a total investment of about $20 billion in Jubail Industrial City II dedicated to downstream chemical and conversion industries.
Comprising 26 world-scale manufacturing units, the Sadara complex is the world’s largest to be built in a single phase and will be the first in the Middle East to use refinery liquids, such as naphtha, as feedstock.
As per the deal, Sadara will supply RCC with aromatics concentrate (Pygas) and Pyoil, generated from cracking naphtha, for use in the new chemical complex planned for PlasChem Park, a collaborative effort between Sadara and the Royal Commission for Jubail and Yanbu (RCJY). The supply agreements will cover a period of 20 years.
The RCC chemical complex will utilise the feedstock obtained from Sadara and potentially other liquid crackers in Saudi Arabia, to produce a wide range of downstream chemical products such as hydrocarbon resin, isoprene, pure DCPD, aromatic solvents, premium wash oils and other products.
Once complete, RCC said it expects to manufacture 12 different downstream products with an overall production capacity of more than 350 kilotonnes per annum (KTA). The complex is projected to be on-stream in December 2020.
Commenting on the agreement, Mohammad Alazzaz, the director of Value Park, Sadara, said: "We are delighted that RCC has selected PlasChem Park as the site for one of the largest hydrocarbon resin plants in the world, and certainly the biggest undertaking in PlasChem Park thus far."
"The new RCC plant will produce unique specialty chemicals that will serve the growing specialty chemicals industry in the kingdom and the wider Middle East and North Africa (Mena) region, filling a gap in local manufacture and supply," he stated.
RCC is a local Saudi company established by Global Company for Downstream Industries (GDI) specifically for the utilisation of Pygas and Pyoil and the production of hydrocarbon resins, among other downstream products in Saudi Arabia.
Fawaz Al Shora, the general manager of RCC, said: "For the past three years, RCC has been developing this project to be one of the most well-integrated complexes in the world for the production of hydrocarbon resins and various other products, all of which resemble a great contribution to the downstream chemicals industry in the kingdom of Saudi Arabia."
Al Shora pointed out that the implementation of the project will convert under-utilised existing raw material streams into value-added specialty chemicals and products.
"The synergy created between naphtha crackers, such as Sadara’s mixed feed cracker and other liquid crackers in Saudi Arabia, and the Rufayah chemical complex allows a very dynamic and efficient model to capitalise on available raw materials through sustainable value addition," he noted.
Alazzaz said Sadara was proud to work with the RCC team as it mainly composed of entrepreneurial Saudis with a strong determination to create value in the kingdom.
"RCC will collaborate with a leading technology provider and producer of hydrocarbon resins to implement the necessary technology. We see significant opportunities to enable more local production in the specialty sector, reducing reliance on imported materials especially in applications such as specialty plastics, oil and gas chemicals, construction material, water treatment, home/personal care, comfort market, and other applications," he added.
In his comments, Prince Nayef bin Sultan bin Mohammed bin Saud Al Kabeer, GDI chairman, said: "The Rufayah complex aligns perfectly with the overall strategies of the kingdom, diversifying its production portfolio, and promoting further downstream opportunities."
"Hydrocarbon resins alone are a key component in the adhesives industry, paints and coatings sector, inks manufacturing, and rubber compounded products. Other products such as premium wash oils, aromatic solvents, and naphthalene will substitute local imports by providing them on a next-door basis, with quality and services exceeding the current imported products," he added.