Sadara Chemical Company (Sadara), a joint venture formed in 2011 between Dow and Saudi Arabian Oil Company (Saudi Aramco), continued to advance in 2012. When completed, Sadara’s world-scale operations, supported by strong back-integration to competitive feedstocks, will be a key enabler of Dow’s strategy to drive long-term profitable growth in its downstream, innovation-driven businesses and in fast growing regions.
Capitalizing on rapidly expanding markets in energy, transportation, infrastructure and consumer products, Sadara is expected to deliver high-margin growth for decades to come. It is anticipated that the joint venture will bring:
- Estimated to deliver EBITDA margins of 35-40 percent and average equity earnings for Dow of approximately $500 million annually during the first 10 years following its start-up
- Positive cash flow to Dow within five years of start-up
Encompassing 26 manufacturing plants, the integrated complex under construction in Jubail Industrial City II, Kingdom of Saudi Arabia, will possess flexible cracking capabilities and produce more than 3 million metric tons of high-value performance plastics and specialty chemical products. Major product families include amines, glycol ethers, isocyanates, polyether polyols, propylene glycol, polyethylene and polyolefin elastomers. Sadara’s first production units will come on line in the second half of 2015, and all units are expected to be up and running in 2016.
Through a set of agreements signed in 2012, Dow will market and sell the majority of products produced by Sadara. Dow will leverage its global marketing expertise, strong brand recognition and well-established market channels, along with Sadara’s strategic, well-positioned location, to bring high-value products to new and existing customers in fastgrowing regions. More than half of the products Sadara offers will be targeted for expanding Asia Pacific markets, while the majority of the remainder will be sold in other key growth countries in Central and Eastern Europe, Africa and India.
||Dow: 35%, Saudi Aramco: 65%
Dow and Saudi Aramco shares will be equal following introduction of a third investor (PublicCo) formed for purposes of holding shares in Sadara and conducting an initial public offering (IPO) through the Saudi Capital Market Authority
||Dhahran, Saudi Arabia
||26 manufacturing units being built in Jubail Industrial City II, Eastern Province, Saudi Arabia
||Ethylene, propylene oxide, propylene, benzene, toluene, pygas, polyethylene, polyurethanes (isocyanates, polyether polyols), propylene glycol, butyl glycol etherers, amines, polyolefin elastomers
||High-growth end markets such as: transportation (automotive parts, maintenance fluids), construction (pipes, adhesives & sealants), packaging and containers (food and non-food), consumer goods (foam for furniture and bedding; rigid PU foam insulation for appliances), adhesives and sealants, coatings (wide range of coatings for industrial, maintenance and marine applications), oil and gas (pipeline protection & flow assurance, gas treatment), electrical and electronics (wire and cable, insulation)
For more information, visit the Sadara website.
Sadara is owned by Dow Saudi Arabia Holding BV, a wholly-owned subsidiary of The Dow Chemical Company, and Performance Chemicals Holding Company, a wholly-owned subsidiary of Saudi Arabian Oil Company.