Two recently implemented world-class projects have put into the spotlight British Offset’s useful role under the Saudi British Economic Offset Programme in advancing Saudi industrialisation and the local economy.
British Offset, which helps local Saudi companies and foreign investors to establish joint venture projects in the kingdom, played a significant role in the development of the Jubail Energy Services Company (Jesco) and Arabian Amines Company (AAC).
British Offset is particularly active in Saudi Arabia’s Eastern Province where both Jesco and AAC are located.
“We provide detailed planning and investment advice and, through our high-level links with the Saudi Government, are able to assist and support joint ventures in the kingdom,” said Tony Smith, senior executive at the British Offset Office in London.
“Risk-free financing is also available to foreign investors participating under the Offset Programme,” Smith added.
Jesco will be the first producer of seamless steel pipes in the GCC and when at full production capacity in 2011 will produce 400,000 tonnes per year for the oil and gas industry and employ 700 staff. The majority shareholder in the joint venture is the local Saudi company Taqa with Duferco of Switzerland as the foreign partner and the balance of shares made up by other prominent Saudi investors.
The integration of seamless pipes manufacturing with its already equipped services to the oil and gas industry will provide better synergies and opportunities for Taqa as a group.
AAC undergoing commissioning
AAC is a 50:50 joint venture between the local Zamil Group and Huntsman Corporation of the US for making ethyleneamines. They recently announced the completion of their plant. The 27,000 tonnes per year plant is currently in the commissioning stage and will commence deliveries in April 2010. The joint venture will license Huntsman’s proprietary ethyleneamines production technology and Huntsman will have exclusive sales, marketing and technical service rights for the plant’s output.
Other major projects
In addition to these two new projects, British Offset has supported the development of other major projects in the region, including the Saudi Polyolefins Company and International Diol Company.
At Saudi Polyolefins Company where Tasnee owns 75 per cent and Lyondell Basell 25 per cent of the shareholding, production goes back to early 2004. The joint venture has two integrated factories namely a propylene factory with an annual production capacity of 455,000 tonnes, which was, then, the largest of its kind worldwide, and a polypropylene factory with an annual production capacity of 450,000 tonnes. Annual production capacity of polypropylene has recently been increased to 720,000 tonnes.
International Diol Company was established in 2002 and is majority owned by Sipchem in a joint venture with the Public Pension Agency, Gosi, Huntsman Corp, Davy Process Technology, Arab Supply & Trading Company (Astra) and AS Albabtain & Company. International Diol Company had successfully started initial production in October 2005 and is now going on stream with a total capacity of 75,000 tonnes per year to meet the growing demand for butanediol and derivatives in the world and domestic markets.
“British Offset is continuing to help develop joint venture projects across Saudi Arabia which assist with the diversification of the kingdom’s economy, provide opportunities for local manufacture thereby reducing reliance on imported goods, and, of increasing importance, create employment for Saudi nationals,” Smith said.
