Sabic has signed an agreement with the Japan Saudi Arabia Methanol Company (JSMC), renewing the partnership in the Saudi Methanol Company (Ar-Razi) for another 20 years.
The agreement comes after a long and fruitful partnership between the two companies, marked by the successful transfer of technology. It demonstrates Sabic’s strategy to strengthen relationships with its global partners and reflects its leading position in the petrochemicals industry, including methanol production.
Under the agreement, which was approved by regulatory bodies, Sabic will raise its stake in Ar-Razi to 75 per cent, reducing JSMC’s shareholding in Ar-Razi to 25 per cent. JSMC will pay more than SR5 billion to Sabic for renewing the joint venture partnership, which Sabic will use, in part or whole, to finance refurbishment of Ar-Razi’s existing methanol plants or set up new ones.
By concluding the agreement, Sabic will become an equal co-owner with JSMC in a new, highly efficient methanol production technology, which will be freely commercialized inside or outside the Kingdom of Saudi Arabia.
"Ar-Razi is the first joint venture in Sabic's history and one of the most successful partnerships that the company has had over 40 years,” said Yousef Al-Benyan, Sabic Vice Chairman and CEO.
“Renewing the partnership for more 20 years is proof of its success and contribution to the Saudi-Japan strategic cooperation, in line with Vision 2030,” he added.
Ar-Razi was established on November 24, 1979, as a 50/50 joint venture between Sabic and JSMC with the aim of developing, establishing, owning and operating a methanol complex.