Advanced Global Investment Company (AGIC), a subsidiary of PP producer Advanced Petrochemical, has signed three separate Memoranda of Understanding (MoUs) with SK Gas, an affiliate of South Korea’s SK Group, to build petrochemicals and propane dehydrogenation (PDH)/PP complexes in Jubail Industrial City, Saudi Arabia.

The first agreement covers the construction of a mixed feed or liquid cracker and downstream products. Under the terms of the MoU, the companies will carry out a detailed feasibility study including a technical evaluation of new and conventional technologies, a detailed market study of potential products, an assessment of the project costs and development of a financial model.

The partners did not disclose the size of the cracker.

A second MoU covers the development of a PDH/PP complex. This project, which has an estimated cost of $1.8 billion, will produce 750,000 t/y of both propylene and PP. Start-up is scheduled by the second half of 2024.

The PP plant will produce value-added grades to manufacture compounds for the automotive industry as well as other specialized grades that the Kingdom currently imports. A 100,000 t/y PP compounding plant will be built under the third MoU at a cost of $40 million.

A portion of the propylene output from the PDH unit will also feed a 70,000 t/y isopropanol plant. Investment costs for this plant are expected to be $100 million.

Advanced said it has received an allocation of propane feedstock for the PDH plant from the Ministry of Energy, Industry and Mineral Resources.