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Saudi Kayan boosts ethylene production

10th February 2015

Saudi Kayan has reached an agreement with the Saudi Arabian ministry of petroleum and mineral resources and SABIC (Saudi Basic Industries Corporation) on Feb 5, to enhance the company’s business and financial performance

Saudi Kayan has reached an agreement with the Saudi Arabian ministry of petroleum and mineral resources and SABIC (Saudi Basic Industries Corporation) on Feb 5, to enhance the company’s business and financial performance
The projects are to be commissioned not later than the second quarter of 2017

The agreement involved allocating an extra volume of ethane gas, amounting to 10 million square feet every day, as of July 1.

The allocation will be subject to the terms and conditions stipulated in the allocation letter, which obligates Saudi Kayan to implement the debottlenecking projects to increase the production capacity of ethylene to a minimum of 93 ton per annum, and the pure ethylene oxide to a minimum of 61 ton per annum.

The projects are to be commissioned not later than the second quarter of 2017.

Till this date (the completion of the project), according to the agreement, Saudi Kayan will be utilising the allocated ethane instead of the butane, as of the above date, to produce Ethylene.

The agreement stipulates that SABIC will reduce the marketing costs with one-third value, as of July 1. This has been stated by Omar Al-Amoudi, chairman of Saudi Kayan, who indicated that this agreement would probably have a positive financial impact on the company’s financial performance in form of SR 280 million in 2015, and SR 600 million per annum, upon completion of the projects in light of the current prices and production rates.

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