Saudi Specialized Industrial Parks


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Local Industry Inputs for an Automotive Sector (I)- Petrochemicals
Abdullah Alrabeeah, Executive Vice President, Performance Chemicals, SABIC
Event - Saudi Arabia: New Auto Market Hub for the Middle East, Africa and South Asia
Presented June 26, 2013

Published in: Business
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Saudi Specialized Industrial Parks

  2. 2. No. 1 SABIC CHEMICALS AND POLYMERS ENABLE AUTO INDUSTRY Rubber tire: PBR & Carbon Black Seats: Polyurethane Light shield: Polycarbonate Electrical parts: POM (PolyAcetal Monomer) / DOP Exterior parts: Carbon Fiber (potential), Polyurethane Anti-freeze Ethylene Glycol Lubricants: LAO and Ethoxylates Paints and coatings: Acrylates, OXO , MMA, Polyurethane & Ethoxylates Powertrain body & chassis: Metals Exterior parts: Plastics, Polyurethane Structural panels: Polyurethane, Plastics Rubber: Hoses, belts Electronics: Acrylonitrile Butadiene Styrene (ABS), Polyurethane Exterior parts: Polycarbonate Light shield: PMMA Rubber seals: EPDM
  4. 4. No. 3 THE SPECIALIZED PARKS Engineering Plastics Park (POM, PMMA, Acrylonitrile Butadiene Styrene (ABS), Polycarbonate) Metals Park Rubber Park (tire & rubber goods) Carbon Fiber ParkPolyurethane Park (seating & insulation) Additives Park (fuel, lubricants and construction) Paints and Coatings Park The specialized parks will produce parts and finished materials for automotive and other wide industrial application hosted in the kingdom of Saudi Arabia for consumption by markets in Saudi Arabia, Middle East, Africa and Europe.
  5. 5. No. 4 BESIDE AUTO INDUSTRY THE PARKS WILL NEED MATERIAL FOR SAUDI ARABIA’S MEGA INDUSTRIES The Kingdom of Saudi Arabia is the: • Largest oil producer in the world • 5th producer of chemicals and petrochemicals in the world • Largest producer of desalinated water in the world • Plans to be number 1 producer of non fossil fuel and electric power generation • Plans for downstream industry beyond oil and chemicals • Plans for automotive industry All need industrial materials and services
  6. 6. No. 5 POWER SAUDI ARABIA MAJOR INDUSTRIAL CORPORATION MAP Saudi Arabia HYDROCARBON RESOURCES Enablers WATER REFINING METAL Basic Chemicals Downstream ChemicalsSpecialized Industrial Parks provide materials and services Auto industry Household industry Non fossil fuel energy industry Packaging industry
  7. 7. No. 6 PARKS WILL MANUFACTURE AND DISTRIBUTE PRODUCTS TO LOCAL AND REGIONAL CUSTOMERS Unit Park capacities To KSA To ME To Africa To Europe & ROW Quantity (KTA) 1200 682 235 127 159 % 100 57 20 11 12 Middle East (including GCC & Turkey) 235 KTA 20% Park’s finished products output (Cap:1200 KTA) Europe 159 KTA 12% AFRICA 127 KTA 11% Local (Saudi Arabia) 682.6 KTA 57% Africa combined revenue expected to be 2.6 trillion by 2020. It is considered an attractive region for future investment (based on Ernst & Young’s survey, 2011)
  8. 8. No. 7 RUBBER PARK RUBBER INDUSTRY OVERVIEW Tires Hoses Seals Engine belts Conveyor belts END APPLICATIONS Primary raw materials Utilities Nat/Syn rubber CBlack/Fillers Fine Chem Process Oil Electricity Steam Machinery Mixing Tires MRG Steel cord Fabric Molds Wire/Fabric Metal Inserts Semi finished rubber (sheet etc) Testing Institutes Warehouse Distribution Scrap and Recycling New Sales Service/Repair Mold & Dies Engineering designs (CAD/ CAM) Info Centers Trade Association Sales Marketing T&I; applications know-how
  9. 9. No. 8 ENGINEERING PLASTICS PARK (POM, PMMA, ABS AND POLYCARBONATE ) Example: POM Rod and Sheet is creating various segments of metal replacement industries Few companies are in this business Global POM Rods & Sheet Demand (Demand is 150 KTA) Sheet Rods
  10. 10. No. 9 POLYURETHANE PARK END APPLICATIONS System House Performance products IntermediatesCommodities SABIC KSA System House Tier 1&2 OEMs End producer Target Anchors T&I: applications know-how ADDITIVES PARK OVERVIEW
  11. 11. No. 10 PAINTS AND COATINGS PARK Paints Coatings Tier 1 OEM Primary raw materials Acrylate Esters MMA Surfactants / stabilizers Solvent Electricity Steam Reacting Mixing Resins Primary raw materials Machinery Pigments Solvent Additives Utilities Electricity Steam Acrylic Latex Exterior Acrylic Latex Interior Gloss White Acrylic Latex Warehouse Distribution Scrap and Recycling Utilities Machinery Sales Marketing END APPLICATIONSPAINTS AND COATINGS OVERVIEW T&I: applications know-how
  12. 12. No. 11 ADDITIVES PARK Intermediate Esters Amides OEMS Oil and gas products Intermediate Esters Auxiliaries OEMS Cement and construction products Oil and Gas Construction - Cement Ethoxylates Ethanolimines Ethoxylates Ethanolimines ADDITIVES PARK OVERVIEW END APPLICATIONS T&I: applications know-how
  13. 13. No. 12 ADDITIVES PARK Energy industry Industrial lubricants Diesel fuel additives ADDITIVES PARK OVERVIEW END APPLICATIONS LAO C8/C10/C12 Suffonated LAO Oil recovery Isomerization Drilling fluid Synthetic lubricant Polyalphaolefins (PAO) 2-EH 2-EH Nitrate Diesel fuel additives T&I: applications know-how LAO C20-24 LAO C16-18
  14. 14. No. 13 CARBON FIBER PARK Primary raw materials Carbon Fiber Chopped CF Resin Electricity Steam Sales Marketing Warehouse Distribution Trade Association Utilities Short Fiber Molding Comp. Textiles Pultrusion Filament Winding Prepregs Papers / Veils Preforms Automotive Oil & Gas / Press. Pipe Aviation (Interior) Pultruded Cables Compounds Wind Energy Construction Machinery New Sales Service/Repair T&I: applications know-how
  15. 15. No. 14 SABIC INSPIRES NEW INVESTORS • SABIC products provide continuous leadership and raw materials supply security • Technology and Innovation (T&I) capabilities; 18 technology and application (innovation) centers worldwide. This is an unmatched T&I capability in the Middle East • Specialized technical institutes which will support specialized parks, such as High Institute for Elastomers Industries (HIEI) and the Higher Institute for Plastics Fabrication (HIPF) • Strong global connections and relationships with industries and investors • SABIC itself is a customer as it purchases $12 billion of industrial materials and services • Strong project engineering capabilities to enable the execution of Giga complex; a recent SABIC project included a 50,000 strong labor force at one site, at the same time.
  16. 16. We talked about the WHAT to do Now We talk about the HOW to do it
  17. 17. No. 16 PLUG & PLAY CONCEPT FOR THE UPCOMING SPECIALIZED INDUSTRIAL PARKS IN SAUDI ARABIA Parks (Rubber/POM/PC/ABS, PU, metals,CF, paints & coatings, lubricants /additives/others) Free Zone Plug & Play City Gated and Fenced Skilled Manpower Medical Services Financial Services Strategic Procurement Co. Plug & Play City Managing Co. Market Info Center T&I Coordinator Center Industrial Support IT CompanyProject Management Contractor / Engineering Co. Office Facilities & Accommodation Warehouse Logistics (SCM) Raw Material Specialized Utilities Seaport Airport Railroads Roads
  18. 18. No. 17 BRING YOUR CORE BUSINESS TO THE PLUG AND SPECIALIZED INDUSTRIAL PARK • One-stop shop for all paper work approval and permits • Synergize your industry presence with other manufacturers • Access trained workforce • Rent general services • Rent specialized industrial services • Technology and Innovation coordination center on site • Market information center • Park strategic procurement services; synergize on volume
  19. 19. No. 18 SABIC AND ROYAL COMMISSION OF INDUSTRIAL CITIES HAVE SUCCESSFUL EXPERIENCE IN SAUDIZATION • Experience is available for the investors • SABIC is running with over 85 % Saudis (22,000 jobs) itself and is now Saudizing 5,000 contactor jobs in Saudi Arabia • SABIC Program content : • English and work ethic • Technical training • On Job Training (OJT) • It can be expanded to provide the specialized parks human assets • Government participated in the cost of training and trainees • Quality of graduates is high with a proven track record
  20. 20. No. 19 THE FORMATION OF COUNCIL OF INVESTORS (ONE FOR EACH PARK) DESIGN (Advisory)1 IMPLEMENTATION (Advisory)2 OPERATION ( Take Over)3 Early engagement Investor Park Investors Council Will enable efficient park design, “ fit for purpose” InvestorInvestorInvestorInvestor
  21. 21. No. 20 ENGAGEMENT WITH INVESTORS (WORK IN PROGRESS ) Status of engagement with investors and technology providers Park MOUs signed Engaged & MOU not signed Planned & no engagement yet Engineering Plastic (Rubber / POM ) 1 10 1 PU 3 4 6 Paints and Coatings (MMA / Acrylates) 0 3 2 Additives (OXO / LAO) 1 11 3 Paints and coatings ( Ethoxylates / Amines) 4 17 6 Carbon Fiber 0 3 8 Total 9 48 26
  22. 22. No. 21 WAY FORWARD – SIGN IN • Investors interested on the specialized parks are welcome to : • Join us today after the program in an "Open discussion on SABIC’s Specialized Industrial Parks” at Salon 4 (IV) from 3:30 PM to 5:30 PM • Sign in on the website
  23. 23. No. 22
  24. 24. THANK YOU
  25. 25. No. 24 This presentation has been prepared by SABIC exclusively for information purposes. This presentation has not been reviewed or registered with any public authority or stock exchange. Recipients of this presentation may not reproduce, redistribute or pass on, in whole or in part, this presentation to any other person. The contents of this presentation are not to be construed as legal, business, investment or tax advice. Each recipient should consult with its own legal, business, investment and tax adviser as to legal, business, investment and tax advice. Neither this presentation nor the information contained in it constitutes an offer, invitation, solicitation or recommendation in any respect, including but not limited to in relation to the purchase or sale of shares in any jurisdiction. To the fullest extent permitted by law, SABIC does not make any representation or warranty, express or implied, as to the accuracy or completeness of any information, statements, opinions, estimates, forecasts or other representations contained in this presentation. No responsibility for any errors or omissions from this presentation arising out of negligence or otherwise is accepted. Neither the issue nor delivery of this presentation shall under any circumstances create any implication that the information contained herein is correct as of any time subsequent to the date hereof and SABIC does not intend, and does not assume any obligation, to update or correct any information included in this presentation. This information includes and is based on, among other things, forward-looking information and statements, which are based on the current expectations, estimates and projections of SABIC or assumptions based on information available to SABIC. Such forward-looking information and statements reflect current views with respect to future events and are subject to risks, uncertainties and assumptions. SABIC does not give any assurance as to the correctness of such information and statements. SABIC and brands marked with ™ are trademarks of SABIC or affiliates. © 2013 Copyright by SABIC. All Rights Reserved. DISCLAIMER