Saudi petrochem giant awards $351m EPC contract for South Korea plant
Construction of 400,000-tonne plant in Ulsan, South Korea to start in Q1 2019
Saudi’s Advanced Petrochemical Company (Advanced) has announced a $350.6m engineering, procurement, and construction (EPC) contract for the construction of a new polypropylene plant in South Korea’s southern port city of Ulsan.
According to a filing on Tadawul, construction on the plant – set to produce 400,000 metric tonnes of polypropylene a year – will begin in the first quarter of 2019, with commercial operations expected to start in the first half of 2021.
The deal was signed between SK Engineering and Construction Company and Ulsan PP. The latter was formed through a joint venture between Advanced affiliate, SK Advanced Company, and South Korea-based firm PolyMirae. Ulsan PP's formation was announced on 24 June, 2018.
According to the bourse filing on 23 December, the new plant will be the “largest of its kind in Asia”, and will use “industry leading Spheripol technology”, which belongs to multinational chemicals firm LyondellBasell.
Polypropylene manufactured at this new facility will be sold to customers in South Korea and exported throughout Asia and the world for use in automotive components, injection molding, blow molding, and packaging film.
“Some of the polypropylene will also be sold to compounding companies in South Korea and the broader region,” the exchange missive added.
The deal comes amid a deepening of commercial ties between South Korea and Saudi. Mid-October this year saw the South Korean Government reportedly announce plans to ramp up its support for the country’s builders to win contracts in the Middle East.
According to a Tadawul filing on 22 October, South Korea’s Daelim Industrial won a $892m (SAR3.35bn) contract from Saudi Arabia Mining Company to build on ammonia plant in the kingom’s Ras Al-Kahir Industrial City, as reported by Construction Week at the time.