Saudi JV plans $516m butanol plant project

Saudi Arabia is set to build the world's largest butanol plant to support growth in the Gulf kingdom's paint and coatings industry.

A three-way shareholders agreement has been signed to establish the Saudi Butanol Company, a SR1.939bn ($516m) venture.

It has been signed by the Saudi Kayan Petrochemical Company, a manufacturing affiliate of SABIC, Sadara Chemical Company, a joint venture developed by Saudi Aramco and The Dow Chemical Company, and Saudi Acrylic Acid Company, an affiliate of National Industrialization Company and Sahara Petrochemicals Company.

A statement said it will be the first butanol plant in the Middle East and the largest in the world.

To be located at Jubail Industrial City and operated by Tasnee, the new plant is scheduled to go on-stream in the first quarter of 2015.

It will create new jobs for about 200 and will support the kingdom's efforts to employ Saudi nationals in the private sector.

Under the agreement, the three partners will have equal stake in the production quantities for downstream use or for sales in local and overseas markets.

The plant is expected to produce 330,000 metric tonnes per annum of n-butanol and 11,000 metric tonnes per annum of iso-butanol.