Jubail Acetyls Complex, Saudi Arabia
At the beginning of 2005 Saudi Arabia's Saudi International Petrochemical Company (Sipchem) announced that it had made a final decision to build an acetyls complex at Jubail Industrial City, Saudi Arabia.
The facility is named Jubail Acetyls Complex and is made up of a 460,000t/y acetic acid facility, 330,000t/y vinyl acetate monomer (VAM) plant, 50,000t/y acetic anhydride plant and a 345,000t/y carbon monoxide plant.
Commercial operation of the complex began in December 2009 with the start-up of the VAM plant. The first shipment of VAM from the complex was made to European markets in January 2010.
Sipchem is a joint venture company established in 1999. The company has invested in and operates a 1 million t/y methanol plant and a 75,000t/y butanediol plant located in Al Jubail.
Joint venture agreement
During June 2005 a joint venture agreement was signed between Sipchem and Germany's Helm Arabia for the acetic acid and VAM plants. The agreement comprises a 25% stake in the project as well as long-term marketing and offtake rights to acetic acid and VAM sold outside the Middle East markets. Sipchem will market the products in the Middle East.
Saudi British Bank and HSBC were appointed by Sipchem as financial advisors to the project. The banks assisted in the financial structure of the project with a view to seeking bids from regional banks for project financing.
Acetyl co-production technology
During the second half of 2004, US firm Eastman Chemical announced that it had signed an interim agreement with Sipchem for the licensing of Eastman's proprietary acetyl co-production technology.
In addition to the technology licence, Eastman provided technical support and will market all acetic anhydride from the facility. The acetic acid will be used by Sipchem in the production of vinyl acetate monomer.
Vinyl acetate monomer (VAM) technology
The second half of 2004 also saw Sipchem reach a definitive agreement with DuPont to licence DuPont's technology for the 330,000t/y VAM plant. DuPont also provided technical assistance. The VAM plant began operations on 18 December 2009.
Long-term supplies of natural gas for the acetyls complex come from Saudi Aramco, while methanol for the acetic acid production comes from Sipchem affiliate International Methanol Company (IMC).
This methanol plant, also located in Al Jubail, became operational during the first quarter of 2005. The VAM plant will use about half of the acetic acid produced at the acetic acid plant as its feedstock.
Acetic acid and vinyl acetate plant contract
At the end of the first quarter of 2006 Sipchem announced that it had awarded Fluor Canada a contract for the construction of a 460,000t/y acetic acid plant, a 50,000t/y acetic anhydride plant and common utilities.
The acetic acid plant came into operation on 22 November 2009. Half of the production from the plant is supplied as feedstock for VAM plant and remainder marketed to the international and local markets.
Carbon monoxide facility
Sipchem selected Germany's Lurgi, in partnership with Air Liquide of France, for the construction of a carbon monoxide facility. The CO plant started operations in August 2009. The unit has an output of 345,000t/y of carbon monoxide and is the world's largest CO facility.
Carbon monoxide is the primary feedstock for the production of acetic acid. The contract was awarded on a lump sum turnkey basis. The facility is owned jointly by Sipchem and Saudi Arabia's National Energy Company.
Project management services contract
In the final quarter of 2004, Sipchem awarded the project management services contract for the acetyls complex to the UK's Foster Wheeler. Foster Wheeler is working as part of an Integrated Project Management Team (IPMT) alongside Sipchem.
The role of the team was to develop and issue bid packages for the engineering and construction of the acetyls complex and its associated utilities and offsites. The IPMT managed the engineering and construction activities on behalf of Sipchem and its affiliates.
Construction of the acetyls complex began in mid-2006, with the lump-sum turnkey contract due to be awarded at the end of 2005. The total cost of construction was approximately SR7bn ($1.86bn).
At the end of 2006 Saudi International Petrochemical Company (Sipchem) announced that three of its affiliates signed a combined project finance loan facility of $560m for the Jubail Acetyls Complex. The finance loan was signed with nine regional banks.
Sipchem and the complex affiliates signed an agreement with Public Investment Fund for funding SR1.35bn ($360m) for construction of the acetyls complex in February 2009. The complex had received a loan funding of SR1.12bn from the Saudi Industrial Development Fund and a corporate loan funding of SR1.43bn in 2008.