SABIC has signed a project development agreement (PDA) with China’s Rongsheng Petrochemical for the Jintang advanced materials project in Zhoushan, Zhejiang province, it is reported. SABIC is reportedly considering a strategic equity investment of up to 50% in the Rongsheng New Materials (Zhoushan) entity.
The Jintang advanced materials project is planned as an integrated petrochemical complex spanning olefins, aromatics, polyolefins, vinyls, polyurethane and engineering plastics, with final production capacity reportedly reaching up to 4.5 million tonnes per year. The agreement is reported to represent a project development framework stage on the path toward a final investment decision (FID).
Total investment is reported at 67.5-76 billion yuan (approximately $9.5-10.6 billion). SABIC’s equity investment is capped at up to 50%, and final production capacity is planned at approximately 4.5 million tonnes per year.
SABIC has continued a strategy of expanding its Asian market supply chain through equity investments in large-scale integrated petrochemical complexes in China, and this agreement with Rongsheng Petrochemical is reported to be part of that strategy.
Global petrochemical companies continue to expand their presence in the Asian market through joint ventures and equity investments with large Chinese private petrochemical firms, suggesting more projects with similar joint venture structures could emerge.