The company’s manufacturing business has also seen a significant shift through the manufacture of custom Hawk jet platforms, as well as its own ground equipment, through the Saudi specialised products factory ‘Wahaj’ in Riyadh

Saudi International Petrochemical Company (Sipchem), a key player in the petrochemical sector in Saudi Arabia, is optimistic about the global market outlook and hopes to see more growth in the petrochemical business.

Sipchem, a globally recognised chemical company, recently announced the commercial operation of its polybutylene terephthalate plant (PBT) in Jubail Industrial City.

"This is an important step in Sipchem’s history, as the firm is now very well placed to support the development of local high-end engineering resin-based industry in the region including automotive parts manufacturing in the Kingdom of Saudi Arabia and globally," says Mater Al-Dhafeeri, Sipchem’s vice president, marketing and planning.

With the announcement of commercial operation, customers’ confidence and partnering with Sipchem for business growth improves. Sipchem now can be engaged into long term supply and business development agreements for industries requiring PBT, says Al-Dhafeeri.

This also adds value to Sipchem’s BDO (butanediol) supply chain, as we are now one of the few backward integrated PBT producers. Sipchem now produces and sells high quality PBT, a speciality engineering polymer used extensively in global automotive production and electronics industry, he says. Sipchem exports polymers to Europe, Asia, Africa and North America, besides selling in the local market.

"We have participated in various exhibitions and conducted series of workshops and customer visits to promote the industry that enabled PBT sales locally and internationally. Now that the raw material is available, it is only a matter of time before downstream investors start utilising the material more in the local market for the local industry.

"As a major petrochemical company, we are committed to our role of facilitating and enabling further downstream growth within the kingdom. A commercial grade PBT is a proof of our commitment to localisation, when we brought to the kingdom a new and niche raw material," he says.

The total production capacity of the PBT Plant is 63,000 metric tonnes a year. PBT is a high-speciality engineering polymer used in many applications, such as car parts manufacturing, electrical/electronic products and various other industrial application, he explains.

PBT is a mechanically strong engineering polymer which is heat resistant up to 150°C, chemical resistant and has exceptional electrical properties. It is used as a connector in the electrical and electronics industries, in the automotive industry (electrical system, mirror housings, handles, fuel system) and in a range of household goods (e.g. shower heads, irons). PBT can also be processed into fibres and extrusion applications, he says.

The company has also embarked on the implementation of a transformation programme towards safety excellence in cooperation with the largest specialised companies in this field. Sipchem’s plants occupy one million square metres in the basic industries area of Jubail Industrial City.

Sipchem’s manufacturing business has also seen a significant shift through the manufacture of custom Hawk jet platforms, as well as its own ground equipment, through the Saudi specialised products factory ‘Wahaj’ in Riyadh.

The company has adopted all regulations and requirements subject to the CMA system, to achieve maximum transparency and protect the interests of investors.

Also, Sipchem continued its duties in the area of social responsibility through programmes covering many areas of the kingdom and in all areas of health, culture, sports, training and development.

In the coming years, the company will continue its ambitions to evaluate growth opportunities available locally and globally as defined by its growth strategy, by increasing the capacity of existing plants, embarking into new business opportunities, or mergers and acquisitions, he says.

To a question on what effect falling oil prices had on the company, he says oil prices generally play a big part in the petrochemical business’ performance. Lower oil prices certainly tend to render negative market sentiments. "As a producer we continuously work to enhance our efficiency in doing business and make relentless efforts to optimise cost. We also implemented various marketing strategies to help balance between minimising the impact during low oil prices and maximising the benefit during the high oil prices."

Sipchem was founded in late 1999 as a Saudi closed joint stock company with the objective of becoming a major petrochemical manufacturer, providing high quality basic and intermediate petrochemical products for world markets. Sipchem itself acts as holding company for several subsidiaries. Sipchem’s founders include respected private sector investors (both individuals and companies) from Saudi Arabia and the GCC countries. Sipchem, by delivering value added and export oriented products, plays a meaningful role in harnessing Saudi Arabia’s vast oil and hydrocarbon natural resources.