Saudi Basic Industries Corp. announced May 17 a significant expansion of its production in China, including a 573 million-pound polycarbonate plant, as part of its joint venture with Chinese state-owned firm Sinopec, along with upgrades to its compounding capacities in the country and investments in innovation centers there and in India.
The PC resin plant, to be built in Tianjin as part of its Sinopec Sabic Tianjin Petrochemical Co. joint venture, is expected to be operational in 2015, and is widely reported to be a $1 billion investment.
SSTPC currently produces ethylene, polyethylene, polypropylene and other materials.
Both the new PC resin manufacturing and compounding investments in China reflect the double-digit growth in the PC market there, and the fact that the country remains a net importer of the material, said Charlie Crew, president and CEO of Sabic Innovative Plastics.
He spoke during a May 18 interview in Guangzhou in connection with the Chinaplas 2011 show.
When the Tianjin facility comes online, it will give Sabic 3.5 billion pounds of PC production worldwide, making it the largest producer globally, said Crew, who is also an executive vice president at Sabic.
The company recently started manufacturing PC at its 573 million-pound-capacity Saudi Kayan Petrochemical Co. plant in Jubail, Saudi Arabia, and much of that production is earmarked for here, said Crew.
The Sabic IP unit will market the Kayan material under the name Sabic PC resin, along with the company's Lexan PC materials.
Crew also suggested the expansion of the SSTPC joint venture is part of the strengthening government-to-government ties between China and Saudi Arabia.
Sinopec is a government-owned entity and of course Sabic is 70 percent owned by the government, so the governments are strategically talking, [and] that helps with some of the things we want to do, said Crew. Strategically, China is very important for Saudi and Saudi is very important for China.
Sabic and Sinopec have developed a strong relationship through the joint venture, he said.
We're partnering up with someone who understands the petrochemical industry and understands it very well, he said.
Sabic also announced it is building new technology and innovation centers in Shanghai and Bangalore, India, by 2013. The Shanghai center will house its Greater China regional headquarters.
Crew said Sabic IP's research staffs in the two cities are housed in General Electric facilities there, a legacy of when the IP unit was part of GE. The staffs will move to the new facilities.
The new centers will also house Sabic research in other areas, such as basic chemicals, fertilizers and Sabic's other grades of plastics, he said.
It will be a true Sabic center and not just Sabic Innovative Plastics, Crew said. We'll try to look at China more broadly in this new technology effort.
Crew said the investment is part of China's development in new-technology research.
China has moved from a world manufacturing center to a world manufacturing and technology center, he said. That's been the evolution over the last 10 years.
Wrapping up the firm's spurt of investments, Sabic IP is adding production for PC resin and films at its factories in Shanghai and Nansha, China.
Also at Chinaplas, the company said it is adding dedicated compounding lines for its Lexan PC resin in Shanghai in 2012.
It also said it added a specialty extrusion line at its Nansha plant for optical-grade Lexan and textured products in early 2011, and plans additional capacity expansions of those materials in Asia between 2012 and 2014. The optical-grade capacity is in a Class 1,000 clean room, the company said.
The expansions are designed to ensure sufficient PC supplies for growing Asian markets, the firm said, particularly in the consumer-electronics, electrical, solar, security and automotive industries.
The company also expanded its Lexan compounding capacity in Nansha in late 2010.