Basell JV with Sahara Petrochemical Company Secures Shariah Compliant Financing
Nov 16, 2006
Al-Waha Petrochemical Company, the joint venture between Basell (25%) and Sahara Petrochemical Company (75%) in Al-Jubail Industrial City in the Kingdom of Saudi Arabia, completed the signing of the Shariah compliant Financing Facilities Agreement and all related financing documents with six regional banks.
"We are proud that together with our partner Sahara Petrochemical Company we have succeeded for the first time to arrange non-recourse project financing in the Kingdom based on a Shariah compliant structure," said Volker Trautz, President and CEO of Basell.
Trautz added, "With the combined strengths of both partners we will jointly create a world class manufacturing complex with competitive feedstock and operating costs. With the most advanced technology and using Basell's global marketing capability we will be able to establish and maintain a robust and profitable operation in an increasingly competitive market."
Engineering, procurement and construction (EPC) activities for the 450 KT per year Spherizone polypropylene plant and a propane dehydrogenation unit began in January this year based on an early works agreement with Tecnimont and Daelim. The EPC contract was signed on September 18, 2006 and commercial production is foreseen in the first quarter 2009.
The Spherizone process is Basell's most advanced polypropylene technology and can produce the full range of PP grades, as well as new families of propylene-based polymers with enhanced product properties. Basell operates a Spherizone plant in Brindisi, Italy, and has granted eight Spherizone process licenses with an aggregate capacity of 2.5 million tonnes per year.
The Al-Waha joint venture is Basell's third major investment in Saudi-Arabia. A first joint venture with Tasnee Petrochemicals, involving a polypropylene plant and a propane dehydrogenation unit, commenced commercial operations in May 2004. Its current capacity of 500 KT per year will be expanded to 800 KT by end 2008.
In June this year Basell's second joint venture in the Kingdom, Saudi Ethylene and Polyethylene Company, was established jointly with both Tasnee Petrochemicals and Sahara Petrochemical Company. The new company is currently constructing a cracker for the production of 1000 KT per year of ethylene and 285 KT per year of propylene; one 400 KT per year high density polyethylene (HDPE) plant using Basell's latest generation Hostalen ACP process, and one 400 KT per year low density polyethylene (LDPE) plant using Basell's Lupotech T technology. The start up of these facilities will be in the fourth quarter 2008.
Basell is the world's largest producer of polypropylene and advanced polyolefin products, a leading supplier of polyethylene and catalysts, and a global leader in the development and licensing of polypropylene and polyethylene processes. Basell, together with its joint ventures, has manufacturing facilities around the world and sells products in more than 120 countries.
