Saudi Basic Industries Corporation (Sabic), one of the world's largest petrochemical producers, is looking to increase its overseas investments next year with a joint venture in the United States, according to its chief executive.
Yousef Al Benyan, the vice chairman and chief executive of the Riyadh-based company, said on Monday that consolidation was necessary to strengthen the GCC downstream industry to bring it to the next level of sophistication. He said that Sabic had investment options to help the company achieve its strategic target for 2025.
“We are looking to start a joint venture in the United States as well as looking to expand with our existing partners like Sinopec and ExxonMobil for different regions,” Mr Al Benyan said on the sidelines of the GPCA Forum in Dubai, declining to give further details.
Yet the sector will continue to face a rocky road ahead as the lines between exporting and consuming markets begin to shift. The global petrochemical sector, linked to the price of crude oil, has been hurt by the low commodity prices that have been a mainstay for over two years. Brent crude was trading at US$46.87 per barrel on Monday morning.
Sabic’s third-quarter profit fell by nearly 7 per cent with net income at 5.2 billion Saudi riyals (Dh5.09bn) for the three months to the end of September, compared with 5.6bn riyals a year earlier. Mr Al Benyan said that regional players needed to extend their offerings, adding more complex and competitive products.
“China and the United States are normally a source of demand but they are converting to becoming our competitors,” said Mr Al Benyan. “And keeping our current structure isn’t going to be sustainable for the next decades. The competitive landscape is shifting beneath our feet.”
Sabic said last year that it was looking to invest in Chinese and American companies to expand its technology capability. China plans to increase its output to reduce its imports, as it looks to coal as a cheap petrochemical feedstock.
In May, the Saudi Arabian producer signed an agreement with China’s Shenhua Ningxia Coal Industry Group to develop a greenfield petrochemical complex within three years.
“The only way our industry can survive and thrive is by creating synergies and optimising current assets,” Mr Al Benyan said. “A lack of a global network and assets can be leveraged, which might require more mergers and acquisitions.”
Sabic and Saudi Aramco announced this summer that they will partner for the first time to conduct a feasibility study to develop an oil-to-chemicals complex in the kingdom, which is expected to cost up to US$30bn. Although no time frame was originally given, Mr Al Benyan said that he expected there would be an update on the progress by the second half of next year.
Saudi Aramco plans to spend $300bn over the next 10 years for further investments. “We need to integrate the upstream and downstream businesses,” said Abdulaziz Al Judaimi, the business line head of downstream at Saudi Aramco.
Mr Al Benyan said the industry as a whole needed further mergers and acquisitions. “We need to consolidate and bring the industry to the next level or else small and medium-sized companies will find it difficult to maintain,” he said.
lgraves@thenational.ae
Follow The National's Business section on Twitter
SPEC SHEET: APPLE IPHONE 15 PRO MAX
Display: 6.7" Super Retina XDR OLED, 2796 x 1290, 460ppi, 120Hz, 2000 nits max, HDR, True Tone, P3, always-on
Processor: A17 Pro, 6-core CPU, 6-core GPU, 16-core Neural Engine
Memory: 8GB
Capacity: 256/512GB / 1TB
Platform: iOS 17
Main camera: Triple: 48MP main (f/1.78) + 12MP ultra-wide (f/2.2) + 12MP 5x telephoto (f/2.8); 5x optical zoom in, 2x optical zoom out; 10x optical zoom range, digital zoom up to 25x; Photonic Engine, Deep Fusion, Smart HDR 4, Portrait Lighting
Main camera video: 4K @ 24/25/30/60fps, full-HD @ 25/30/60fps, HD @ 30fps, slo-mo @ 120/240fps, ProRes (4K) @ 60fps; night, time lapse, cinematic, action modes; Dolby Vision, 4K HDR
Front camera: 12MP TrueDepth (f/1.9), Photonic Engine, Deep Fusion, Smart HDR 4, Portrait Lighting; Animoji, Memoji
Front camera video: 4K @ 24/25/30/60fps, full-HD @ 25/30/60fps, slo-mo @ 120/240fps, ProRes (4K) @ 30fps; night, time lapse, cinematic, action modes; Dolby Vision, 4K HDR
Battery: 4441mAh, up to 29h video, 25h streaming video, 95h audio; fast charge to 50% in 30min (with at least 20W adaptor); MagSafe, Qi wireless charging
Connectivity: Wi-Fi, Bluetooth 5.3, NFC (Apple Pay), second-generation Ultra Wideband chip
Biometrics: Face ID
I/O: USB-C
Durability: IP68, water-resistant up to 6m up to 30min; dust/splash-resistant
Cards: Dual eSIM / eSIM + eSIM (US models use eSIMs only)
Colours: Black titanium, blue titanium, natural titanium, white titanium
In the box: iPhone 15 Pro Max, USB-C-to-USB-C woven cable, one Apple sticker
Price: Dh5,099 / Dh5,949 / Dh6,799
FA CUP FINAL
Chelsea 1
Hazard (22' pen)
Manchester United 0
Man of the match: Eden Hazard (Chelsea)
Paris Can Wait
Dir: Eleanor Coppola
Starring: Alec Baldwin, Diane Lane, Arnaud Viard
Two stars
THE BIO
Bio Box
Role Model: Sheikh Zayed, God bless his soul
Favorite book: Zayed Biography of the leader
Favorite quote: To be or not to be, that is the question, from William Shakespeare's Hamlet
Favorite food: seafood
Favorite place to travel: Lebanon
Favorite movie: Braveheart
Hot Seat
Director: James Cullen Bressack
Stars: Mel Gibson, Kevin Dillon, Shannen Doherty, Sam Asghari
Rating: 1/5
MATCH INFO
Uefa Champions League semi-finals, first leg
Liverpool v Roma
When: April 24, 10.45pm kick-off (UAE)
Where: Anfield, Liverpool
Live: BeIN Sports HD
Second leg: May 2, Stadio Olimpico, Rome
Why it pays to compare
A comparison of sending Dh20,000 from the UAE using two different routes at the same time - the first direct from a UAE bank to a bank in Germany, and the second from the same UAE bank via an online platform to Germany - found key differences in cost and speed. The transfers were both initiated on January 30.
Route 1: bank transfer
The UAE bank charged Dh152.25 for the Dh20,000 transfer. On top of that, their exchange rate margin added a difference of around Dh415, compared with the mid-market rate.
Total cost: Dh567.25 - around 2.9 per cent of the total amount
Total received: €4,670.30
Route 2: online platform
The UAE bank’s charge for sending Dh20,000 to a UK dirham-denominated account was Dh2.10. The exchange rate margin cost was Dh60, plus a Dh12 fee.
Total cost: Dh74.10, around 0.4 per cent of the transaction
Total received: €4,756
The UAE bank transfer was far quicker – around two to three working days, while the online platform took around four to five days, but was considerably cheaper. In the online platform transfer, the funds were also exposed to currency risk during the period it took for them to arrive.
Heavily-sugared soft drinks slip through the tax net
Some popular drinks with high levels of sugar and caffeine have slipped through the fizz drink tax loophole, as they are not carbonated or classed as an energy drink.
Arizona Iced Tea with lemon is one of those beverages, with one 240 millilitre serving offering up 23 grams of sugar - about six teaspoons.
A 680ml can of Arizona Iced Tea costs just Dh6.
Most sports drinks sold in supermarkets were found to contain, on average, five teaspoons of sugar in a 500ml bottle.
When is VAR used?
• Goals
• Penalty decisions
• Direct red-card incidents
• Mistaken identity
Abu Dhabi GP Saturday schedule
12.30pm GP3 race (18 laps)
2pm Formula One final practice
5pm Formula One qualifying
6.40pm Formula 2 race (31 laps)
TO CATCH A KILLER
Director: Damian Szifron
Stars: Shailene Woodley, Ben Mendelsohn, Ralph Ineson
Rating: 2/5
Ahmed Raza
UAE cricket captain
Age: 31
Born: Sharjah
Role: Left-arm spinner
One-day internationals: 31 matches, 35 wickets, average 31.4, economy rate 3.95
T20 internationals: 41 matches, 29 wickets, average 30.3, economy rate 6.28
RESULT
Copa del Rey, semi-final second leg
Real Madrid 0
Barcelona 3 (Suarez (50', 73' pen), Varane (69' OG)
ACC 2019: The winners in full
Best Actress Maha Alemi, Sofia
Best Actor Mohamed Dhrif, Weldi
Best Screenplay Meryem Benm’Barek, Sofia
Best Documentary Of Fathers and Sons by Talal Derki
Best Film Yomeddine by Abu Bakr Shawky
Best Director Nadine Labaki, Capernaum