Advanced Petro & Bayegan sign MoU for PP plant
Advanced Petrochemical Company, a leading Saudi Arabia based producer of petrochemical products, and Bayegan Group, a unique Turkish international trading company, engaged in petroleum derivatives, petrochemicals and other commodities, announced the signing of a Memorandum of Understanding for the development of a joint US$ 1 billion Propane Dehydrogenation (PDH)and Polypropylene (PP)plant.
The announcement was made at a signing ceremony in Istanbul in the presence of Turkey's Minister of Economy Mr. Zafer Çaglayan, as well as representatives of the joint venture partners and their shareholders. The ceremony was also attended by members of the industry and media to mark this important milestone.
The project, in which Advanced will hold a 70% equity stake and Bayegan Group 30%, is comprised of construction of a state-of-the-art PDH-PP Plant, all other required utilities and port facilities, to be located in Southern Turkey. Once fully operational, the plant is expected to produce approximately 500,000 tons of polypropylene per year. At current rates, this will replace approximately 30% of polypropylene imports into the country.
Commenting on the announcement, Chairman of Advanced Petrochemical Company, Mr. Khalifa Abdullatif Al Mulhem, said: “This project is of great significance for Advanced. It marks our first major overseas investment and is an important step forward in the execution of our growth strategy.
It is also an important project which will enhance further industrialization in Turkey. Our investment reflects our confidence in the strength of our partner, Bayegan Group and the Turkish economy as well as its investment friendly climate, for which we thank them.
More importantly, this venture is a true reflection of the strong and everlasting cooperation, trade and investment between Turkey and the Kingdom of Saudi Arabia, which are both among the most dynamic and fast growing economies globally.”
The development of the project will leverage the knowledge, experience and track record of Advanced in developing, executing and operating world class facilities that are highly efficient, environmentally friendly and which support economic growth in their markets of operation. Advanced currently operates PDH and PP plants in Saudi Arabia's Jubail Industrial City. The company produces 450,000 tons of polypropylene per year, which is known for its high quality and reliability. Advanced's polypropylene is marketed and sold globally across the Middle East, Asia and Europe, with 30% of its output sold to customers in Turkey.
Bayegan's strength in global trading, distribution and their immense knowledge on the Turkish domestic market will perfectly complement Advanced's technical expertise in ensuring successful implementation of the Project.
Mr. Ercument Bayegan, Chairman of Bayegan Group, added “We are extremely proud with this major step to realize this Project. As Bayegan, this project is in line with our vision to continue our growth globally with our 23 worldwide offices.