Saudi Arabia’s Ministry of Energy awards prestigious feedstock allocation for joint project between Sipchem and LyondellBasell
Sipchem and LyondellBasell (LYB) have received a important feedstock allocation from Saudi Arabia's Ministry of Energy for their joint feasibility study of a world-scale mixed feed cracker complex with derivatives. The project will be structured on a 60% Sipchem and 40% LYB ownership basis.
The planned facility aims to manufacture petrochemical products and derivatives for both Saudi Arabian and global export markets, promising to create thousands of local jobs. The project will utilize LYB's technologies to produce specialized grades of polyethylene and polypropylene, including the Catalloy product line of elastomeric polyolefins.
Both companies will explore carbon management solutions and low emission technologies to support their net zero ambitions. The project benefits from strategic advantages including cost-effective feedstocks, world-scale assets, advanced technologies, and proximity to key international markets.
Sipchem e LyondellBasell (LYB) hanno ricevuto un'importante allocazione di materie prime dal Ministero dell'Energia dell'Arabia Saudita per il loro studio di fattibilità congiunto di un complesso di cracker a feed misto di scala mondiale con derivati. Il progetto sarà strutturato su una base di 60% Sipchem e 40% LYB.
La struttura pianificata mira a produrre prodotti e derivati petrochimici per i mercati di esportazione sia dell'Arabia Saudita che globali, promettendo di creare migliaia di posti di lavoro locali. Il progetto utilizzerà le tecnologie di LYB per produrre gradi specializzati di polietilene e polipropilene, inclusa la linea di prodotti Catalloy di poliolefine elastomeriche.
Entrambe le aziende esploreranno soluzioni di gestione del carbonio e tecnologie a basse emissioni per supportare le loro ambizioni di zero emissioni nette. Il progetto beneficia di vantaggi strategici tra cui materie prime a costi contenuti, asset di scala mondiale, tecnologie avanzate e vicinanza ai principali mercati internazionali.
Sipchem y LyondellBasell (LYB) han recibido una importante asignación de materias primas del Ministerio de Energía de Arabia Saudita para su estudio de viabilidad conjunto de un complejo de cracker de alimentación mixta de escala mundial con derivados. El proyecto se estructurará sobre una base de 60% Sipchem y 40% LYB.
La instalación planificada tiene como objetivo fabricar productos petroquímicos y derivados para los mercados de exportación tanto de Arabia Saudita como globales, prometiendo crear miles de empleos locales. El proyecto utilizará las tecnologías de LYB para producir grados especializados de polietileno y polipropileno, incluida la línea de productos Catalloy de poliolefinas elastoméricas.
Ambas empresas explorarán soluciones de gestión de carbono y tecnologías de bajas emisiones para apoyar sus ambiciones de cero emisiones netas. El proyecto se beneficia de ventajas estratégicas que incluyen materias primas rentables, activos de escala mundial, tecnologías avanzadas y proximidad a los principales mercados internacionales.
시프켐(Sipchem)과 리온델바젤(LyondellBasell, LYB)은 사우디아라비아 에너지부로부터 세계적 규모의 혼합 원료 크래커 복합체와 파생물에 대한 공동 타당성 연구를 위한 중요한 원료 할당을 받았습니다. 이 프로젝트는 60% Sipchem과 40% LYB의 소유 구조로 구성될 것입니다.
계획된 시설은 사우디아라비아 및 글로벌 수출 시장을 위한 석유화학 제품 및 파생물을 제조할 것을 목표로 하며, 수천 개의 지역 일자리를 창출할 것을 약속합니다. 이 프로젝트는 LYB의 기술을 활용하여 카탈로이(Catalloy) 제품 라인의 엘라스토머 폴리올레핀을 포함한 특수 등급의 폴리에틸렌 및 폴리프로필렌을 생산할 것입니다.
양사는 탄소 관리 솔루션과 저배출 기술을 탐색하여 탄소 중립 목표를 지원할 것입니다. 이 프로젝트는 비용 효율적인 원료, 세계적 규모의 자산, 첨단 기술 및 주요 국제 시장과의 근접성 등 전략적 이점이 있습니다.
Sipchem et LyondellBasell (LYB) ont reçu une importante allocation de matières premières du ministère de l'Énergie d'Arabie Saoudite pour leur étude de faisabilité conjointe d'un complexe de cracker à alimentation mixte de grande envergure avec des dérivés. Le projet sera structuré sur une base de 60% Sipchem et 40% LYB.
La structure prévue vise à fabriquer des produits et dérivés pétrochimiques pour les marchés d'exportation saoudiens et mondiaux, promettant de créer des milliers d'emplois locaux. Le projet utilisera les technologies de LYB pour produire des grades spécialisés de polyéthylène et de polypropylène, y compris la gamme de produits Catalloy d'élastomères polyoléfines.
Les deux entreprises exploreront des solutions de gestion du carbone et des technologies à faibles émissions pour soutenir leurs ambitions de zéro émission nette. Le projet bénéficie d'avantages stratégiques, notamment des matières premières rentables, des actifs de grande envergure, des technologies avancées et la proximité des principaux marchés internationaux.
Sipchem und LyondellBasell (LYB) haben eine wichtige Zuteilung von Rohstoffen vom Ministerium für Energie Saudi-Arabiens für ihre gemeinsame Machbarkeitsstudie eines weltgrößten Mischfuttercracker-Komplexes mit Derivaten erhalten. Das Projekt wird auf der Grundlage von 60% Sipchem und 40% LYB strukturiert.
Die geplante Anlage zielt darauf ab, petrochemische Produkte und Derivate für die saudi-arabischen und globalen Exportmärkte herzustellen, und verspricht, Tausende von lokalen Arbeitsplätzen zu schaffen. Das Projekt wird die Technologien von LYB nutzen, um spezialisierte Grade von Polyethylen und Polypropylen, einschließlich der Catalloy-Produktlinie von elastomeren Polyolefinen, zu produzieren.
Beide Unternehmen werden Lösungen für das Kohlenstoffmanagement und Technologien mit niedrigen Emissionen erkunden, um ihre Ziele für Netto-Null-Emissionen zu unterstützen. Das Projekt profitiert von strategischen Vorteilen, darunter kostengünstige Rohstoffe, weltgrößte Anlagen, fortschrittliche Technologien und die Nähe zu wichtigen internationalen Märkten.
- Strategic feedstock allocation secured from Saudi Ministry of Energy
- Cost-advantaged raw materials access
- Creation of thousands of local jobs
- Access to proprietary LYB technology for specialized products
- Strategic location near key international markets
- Project still in feasibility study phase - no final investment decision
- Significant capital investment required (amount unspecified)
- Execution and construction risks for world-scale facility
Insights
The Saudi Ministry of Energy's feedstock allocation for Sipchem and LyondellBasell's joint venture represents a strategic positioning in the global petrochemical landscape. This development provides LYB with access to cost-advantaged feedstocks in Saudi Arabia – a important competitive factor that typically determines 60-70% of production economics in petrochemical manufacturing.
This world-scale cracker complex would significantly expand LYB's manufacturing footprint in a region offering structural advantages. The 40% ownership stake aligns with LYB's capital-efficient growth strategy, allowing them to leverage their proprietary technologies (particularly their high-margin Catalloy elastomeric polyolefins) without bearing the full capital burden of a greenfield facility, which would likely exceed
For investors, several factors merit attention:
- The project timeline suggests a multi-year development process – feasibility studies (12-24 months), followed by final investment decision, then construction (3-5 years) – positioning this as a long-term growth initiative rather than near-term earnings driver
- The venture enhances LYB's geographical diversification, reducing exposure to volatile North American natural gas liquids pricing while gaining proximity to high-growth Asian markets
- The carbon management focus addresses increasing ESG demands from investors and potentially positions the facility advantageously under future carbon pricing mechanisms
While the feedstock allocation marks significant progress, investors should note that many announced Middle East petrochemical projects never advance beyond feasibility stage due to changing market conditions or technical/commercial challenges. The venture's success will ultimately depend on execution quality, global supply-demand dynamics upon completion, and the partners' ability to differentiate their product portfolio in increasingly commoditized markets.
Award marks important milestone in feasibility study of Saudi-based world-scale steam cracker and derivatives
AL KHOBAR, Kingdom of Saudi Arabia and HOUSTON, Feb. 27, 2025 (GLOBE NEWSWIRE) -- Sipchem and LyondellBasell (LYB) have been awarded a feedstock allocation from the Ministry of Energy of Saudi Arabia supporting a joint feasibility study for a world-scale mixed feed cracker complex combined with a diversified derivative portfolio. Sipchem and LYB will assess the viability and optimal structure for the project, which will be advanced on a
With cost-advantaged feedstocks, world-scale assets, leading technologies, and proximity to key international markets, the joint project has the potential to create lasting value. The project will benefit from LYB’s technologies to produce differentiated grades of polyethylene and polypropylene, including the Catalloy product line of elastomeric polyolefins.
Sipchem and LYB will jointly explore carbon management solutions including the use of low emission technologies, in support of the parties’ and the Kingdom’s net zero ambitions.
“Our partnership with LyondellBasell marks an important milestone in our pursuit of ambitious goals for sustainable growth and the strengthening of our position within the petrochemical market locally and globally,” said Abdullah Al-Saadoon, Sipchem chief executive officer. “Through this collaboration, we will leverage the latest cutting-edge, energy-efficient technologies, significantly contributing to our environmental objectives and enhancing the sustainability of our operations. We extend our gratitude to the Ministry of Energy for its unwavering support of the petrochemical industry, which has been instrumental in enabling us to achieve our shared goals. We are enthusiastic about advancing this project and are committed to delivering high-quality products that will drive the development of the industrial sector in the Kingdom of Saudi Arabia.”
“This feedstock allocation is a vital step in our collaboration with Sipchem,” said Peter Vanacker, LyondellBasell chief executive officer. “As we move forward with our joint study, with a long-term partnership in mind, we further strengthen our commitment to Saudi Arabia. Thank you to the Ministry of Energy for their support and collaboration as we build on our successful partnership. We look forward to being a larger part of the Kingdom's thriving economy, which continues to grow and provide numerous opportunities for development and innovation.”
About LyondellBasell
We are LyondellBasell (NYSE: LYB) ― a leader in the global chemical industry creating solutions for everyday sustainable living. Through advanced technology and focused investments, we are enabling a circular and low carbon economy. Across all we do, we aim to unlock value for our customers, investors and society. As one of the world's largest producers of polymers and a leader in polyolefin technologies, we develop, manufacture and market high-quality and innovative products for applications ranging from sustainable transportation and food safety to clean water and quality healthcare. For more information, please visit www.lyondellbasell.com or follow @LyondellBasell on LinkedIn.
About Sipchem
Sipchem, officially known as Sahara International Petrochemical Company (TASI: SIPCHEM) ― a Saudi-based leading innovator in the petrochemical sector, founded in 1999. The company provides high-quality chemical and polymer products that serve diverse industries, including construction, automotive, electronics, and packaging. With a strong focus on sustainability, Sipchem integrates energy efficiency, waste reduction, and advanced technologies into its operations to support a circular economy and minimize its environmental impact. Through continuous investment in research and development, Sipchem delivers innovative solutions that address evolving global needs and contribute to long-term growth. For more information, please visit www.Sipchem.com or follow @SipchemGlobal on LinkedIn.
Cautionary Note Regarding Forward-looking Statements
The statements in this release relating to matters that are not historical facts are forward-looking statements. Actual results could differ materially based on factors including, but not limited to, our ability to meet the requirements of the allocation award; the results of the feasibility study described in this release; future investment decisions and the successful development, construction and operation of the proposed facilities described in this release; our ability to implement our strategy and successfully align our asset base with that strategy; and general economic conditions in the Kingdom of Saudi Arabia and globally. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in the "Risk Factors" section of our Form 10-K for the year ended December 31, 2023, which can be found at www.LyondellBasell.com on the Investor Relations page and on the Securities and Exchange Commission’s website at www.sec.gov. There is no assurance that any of the actions, events or results of the forward-looking statements will occur, or if any of them do, what impact they will have on our results of operations or financial condition. Forward-looking statements speak only as of the date they were made and are based on the estimates and opinions of management of LyondellBasell at the time the statements are made. LyondellBasell does not assume any obligation to update forward-looking statements should circumstances or management's estimates or opinions change, except as required by law.
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