Sabic (Saudi Basic Industries Corporation) signed a preliminary agreement with the state-controlled Russian Direct Investment Fund and Moscow-based ESN Group for a potential investment in a methanol plant in the Russian Far East, as the Middle East’s biggest petrochemicals producer looks to expand its international footprint.
The agreement, part of a broad range of pacts signed during the visit of Russian President Vladimir Putin to Saudi Arabia on Monday, will explore the option to build and operate a methanol plant with a capacity of a 2 million tonnes per annum in Russia’s Amur region.
Yousef Al-Benyan, SABIC vice chairman and CEO, commented: “This is an important milestone in our global growth strategy. Russia is important to our global expansion plans, which have been formulated around competitive feedstock and our capacity to innovate and plan strategically. We plan to maintain our strategic partnership with the Russian market by continuing to focus on meeting customer needs, increasing our key customer base, and growing our commercial operation, in addition to enhancing our presence in the Russian market and maintain our leading position as a key methanol supplier.”
In January, Sabic signed a preliminary agreement with South Louisiana Methanol to explore the possibility of developing a chemicals plant in the US to profit from the surging North American shale gas production.
It also increased its stake in Arrazi Methanol Company after purchasing Japan Saudi Arabia Methanol Company’s 50 per cent interest for $150 million in December.
Investment in the downstream segment of the energy value chain has become a priority for Middle East oil producers, as they hope to earn revenues from the sale of higher value products.