Sipchem, Tasnee award ethylene cracker expansion project at SAR 1.9B

Logos of National Industrialization Co. and Sahara International Petrochemical Co. (Sipchem)

Sahara International Petrochemical Co. (Sipchem) and National Industrialization Co. (Tasnee) awarded an engineering, procurement, and construction (EPC) contract valued at SAR 1.87 billion ($500 million) to SGC-eTEC on Dec. 21, 2023, both companies said in separate statements to Tadawul.

The contract aims to boost production at the ethylene cracker plant, a joint venture affiliated to Tasnee Sahara Olefins Co. (TSOC), which is 32.55% owned by Sipchem and 60% by Tasnee.

The expansion project will likely be complete in H1 2026, with operations leading to an increase in Olefins production by an estimated 18%.

The contract will likely boost Sipchem’s consolidated financial results, the statement said.

Tasnee’s consolidated earnings will receive SAR 200 million on average per annum from the project, and the relevant financial impact will start to appear in 2026 financial statements.

The project, which will include no related parties, will be 30% financed from internal resources and 70% by other facilities.