re: wor takeover target, page-5

re: wor gets saudi contract Read this article about a few days old and some of the numbers are staggering...7billion dollar project. If there is any doubt about which way wor is going this will settle it. Don't know the cashflow numbers from this project, just know its massive.


Sipchem awards project management deal to WP
BY HABIB SHAIKH

2 December 2006



JEDDAH — The Saudi International Petrochemical Company (Sipchem) has awarded the project management contract for its massive polyolefins complex to Worley Parsons (WP), Houston, USA and the Financial Advisory role to HSBC.


The fully integrated olefins and derivatives complex will consist of a cracker unit that will produce 1.3 million metric tonnes per annum (mtpa) of ethylene and propylene. According to Abdulaziz Al Zamil, Chairman of Sipchem, the entire complex, estimated to cost more than $7 billion, will consist of 20 world scale plants and will employ more than 3,000 people. In a statement made available to Khaleej Times here, he said that in line with Sipchem's strategy to create new investment opportunities that stimulate Saudi Arabia's economic and social development, the company continuously explores the prospects of phase-wise growth and expansion.

"Such projects add value to the abundant natural resources of the Kingdom, and create additional jobs for the growing number of Saudi youth," he said The basic olefins will be used in the production of 800,000 mtpa of polymers such as high density polyethylene (HDPE), low density polyethylene (LDPE), polypropylene (PP), and ethylene vinyl acetate (EVA). The project will complete the products integration to further down stream added-value performance products. Sipchem and its potential partners in this project who signed the feedstock allocation letter with Saudi Aramco — Mitsui of Japan, DuPont of USA, and Lucite of UK are working on the final agreements of the projects which are expected to be signed early next year, while start-up of projects will commence in 2011.

The total production of the complex will amount to 3 million mtpa of 18 different products. The project will fulfill obligations scheduled and agreed with the ministry of petroleum and minerals. In a related development Sipchem has announced that it will go ahead with the construction of its acetic acid and vinyl acetate monomer plants in Jubail despite the case filed against it by Celanese Corp. of the US seeking to block three petrochemical companies from manufacturing the products. According to Ahmed Al Ohali, president of Sipchem, the basis for Celanese's lawsuit against them was false since they were using a different technology.

"Our business is basic clean business ethics. Our technology is totally non-Celanese. We are not using any Celanese papers, trade secrets or documents. What is bothering them is that we have proved to be successful in our business," Al-Ohali said. Regarding the technology, he said they were using Eastman's for their acetic acid plant which will have a capacity of 460,000 tonnes per annum, while the vinyl acetate monomer plant (300,000 tonnes per annum) will rely on Du Pont's technology.

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