Advanced signs a SAR 2.17 bln agreement to develop Pygas, Pyoil project

Advanced Petrochemical Co. has signed a six-month heads of agreement on Tuesday to develop Pygas and Pyoil Downstream Project in Jubail Industrial City II with Global Company for Downstream Industries (GDI), a Saudi entity engaged in developing specialized chemical products and other downstream industries.

The total cost of the project is estimated at $580 million (SAR 2.17 billion) which will be financed 30 percent from equity and 70 percent through debt, the company said in a bourse statement.

The project is set to have a product portfolio of more than 12 specialty chemicals, including hydrocarbon resins, aromatic solvents, premium wash oils, naphthalene and other products to be produced for the first time in MENA region.

Advanced anticipates that it will own a 30 to 40 percent stake in the project through its subsidiary, Advanced Global Investment Co. (AGIC), which is 95 percent owned by Advanced.

The project has an overall capacity of approximately 300 kilo tons per annum and is scheduled to start operations in H1 2021.

Once operational it is expected that the financial benefits of the project will improve the shareholder value for Advanced, the statement added.