Jubail and Yanbu Invest $12 Billion in a Refinery and Two Petrochemical Plants

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Researched by Industrial Info Resources (Sugar Land, Texas). Construction on the first three projects at Saudi Arabia’s industrial city complexes has been given the go ahead with land allocations being made by the Royal Commission. The projects will see an oil refinery and a petrochemical plant built in Jubail and a petrochemical plant in Yanbu. The total investment in the three projects will amount to $12.1 billion. Both centers will have the necessary infrastructure and services available to support the new projects.

Prince Saud bin Abdullah Thunayan, Chairman of the Royal Commission, said that Saudi Aramco in association with Total (NYSE:TOT) (Paris, France) would construct a 400,000-barrel per day (bpd) refinery on a 5 million square meter site at Jubail-2 with an investment of $6.4 billion. The project will create 1, 000 jobs. The refinery will produce basic petrochemical products including benzene, liquidate gas and propylene. The two companies will each hold a 35% stake in the project and the balance of 30% of the shares will be offered to the public.

Sipchem Olefins (an associated company of Saudi Basic Industries – SABIC) will construct a $5.33 billion petrochemical plant at Jubail-2 with 20 products in its output stream. The project will include the production of 1.2 million tons per annum of ethane/propane cracker, bi-modal heavy density polyethylene, polypropylene, vinyl acetate and polyacrylonitrile. At Yanbu-2 on the coast of the Red Sea, a $360 million petrochemical plant will be constructed covering 200,000 square meters.

Saudi Arabia’s King Abdullah laid the foundation stone of the new Jubail-2, which is projected to double the size of the Jubail Industrial City by 6,200 hectares. Jubail-21 is projected to attract $60 billion of project investments and create 55,000 new jobs. The Royal Commission will provide the entire infrastructure for Jubail-2 which is sited 3 kilometers to the west of Jubail-1. The infrastructure and services will cover roads, utilities, gas, electricity, seawater cooling, potable water, wastewater treatment, feed stock and a product pipeline corridor to King Fahd Industrial Port.

The project is a key element in the country’s drive to capitalize and add value to its rich hydrocarbon resources. One of the objectives is to develop the economic and social benefits for the population since the profile is becoming predominately young, aspirational and job-hungry. Both Jubail-21 and Yanbu will consolidate Saudi Arabia’s drive at home and abroad to maintain a globally competitive petrochemical industry.

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