Sharq, a joint venture between Japanese companies and Saudi Arabian government-backed firm Sabic, plans to spend about 250 billion yen ($2.25 billion) to build a large ethylene plant in its petrochemical complex in the Middle Eastern kingdom, it was reported.

Eastern Petrochemical Co (Sharq), the 50-50 joint venture between Saudi Petrochemical Development Co and Saudi government-affiliated Saudi Basic Industries Corp, will conduct a feasibility study on the construction of the plant, which will produce the key raw material for petrochemical products.
Saudi Petrochemical Development is a consortium of 58 Japanese firms, including Mitsubishi Chemical Corp, Mitsubishi Corp and the Japan Bank for International Cooperation.
Since its establishment in 1981, Sharq has added facilities to its petrochemical complex on the eastern coast of Saudi Arabia in three stages.
The newest plan calls for the building of an ethylene plant, with an annual capacity of 1.2 million tonnes, to launch in 2008.
The facility will use ethane and propane as raw materials because they are cheaper than naphtha and less susceptible to fluctuations in the crude-oil market.
The 250 billion yen will also boost the yearly output of polyethylene, used as a wrapping material, by 800,000 tonnes and ethylene glycol for synthetic fibres by 600,000 tonnes.