GUANGZHOU, CHINA—Saudi Basic Industries Corp., the Middle East's largest listed company, said Tuesday that it plans to build a $1 billion polycarbonate plant in northern China with joint-venture partner Sinopec, tapping the Asian country's surging demand for plastics.
The new plant at the joint venture's petrochemical complex in Tianjin will have an annual production capacity of 260,000 metric tons and is expected to be operational by 2015, Sabic said.
Polycarbonate is a key plastic used for producing components for automotive parts and a variety of consumer products.
Sabic Chief Executive Mohamed Al Mady said the project is likely to require a total investment of at least $1 billion from the company's joint venture with China Petroleum & Chemical Corp., also known as Sinopec.
Riyadh-listed Sabic expects China's petrochemical demand to rise 20% annually over the next 10 years as the Asian country's economy expands and infrastructure investments continue, Mr. Al Mady said in an interview.
Mr. Al Mady, who is also Sabic's vice chairman, added that growth from another Asian powerhouse, India, will likely lag behind that of China amid lower per-capita chemical consumption.
"We are engaging with India to seek new opportunities...but India still hasn't opened large investments in the petrochemical industry to foreign companies," he said.
Petrochemical makers such as Sabic are boosting their exports to and investments in Asia, notably China, to meet rapidly rising demand for chemicals and plastics used in the production of industrial and consumer products.
China is the single largest end-market for Middle Eastern petrochemical exports, accounting for about 40% of exports out of the region, according to HSBC's Middle East Chemicals report, published Monday.
Sabic expects to open its Greater China Regional Headquarters in Shanghai in 2013. It also plans to add a similar technology and innovation center in India, according to the company.
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