Saudi Aramco begins construction of Jubail chemical plant

State-owned Saudi Aramco commenced construction works of a manufacturing plant to be built by Halliburton at the ethylene oxide/propylene oxide (EO/PO) cluster of the PlasChem Value Park at Jubail Industrial City II.

The new facility — expected to be operational by the end of 2020 — will be the first specialty oil field chemicals manufacturing reaction plant in Saudi Arabia, and will initially create approximately 100 jobs, the oil giant said in a statement.

Engineering, procurement, and construction (EPC) of the plant will be carried out by the Fluor Corporation, which was awarded the contract in Q4 2018, after completing the front end engineering and design of the facility.

Halliburton will manufacture process treatment chemicals at the facility, which in turn, will be sold primarily to Saudi Aramco for use in upstream and downstream drilling and extraction activities.

Production will be fueled by a steady supply of EO and PO from Sadara via an extensive pipeline network currently under construction.

The network — comprising two seven kilometer special material pipelines — is designed to distribute products to multiple customers within the cluster, and is expected to be completed alongside the new plant’s commissioning in 2020.

The manufacturing of these specialty products in the Kingdom also contributes to the goal of meeting the key benchmark of Saudi Aramco’s IKTVA program, designed to boost local employment.

“This will be done with Saudi talent in line with IKTVA’s 70 percent benchmark,” Mohammed Al Qahtani, Saudi Aramco senior vice president of Upstream, said.

“To date, we have achieved an overall localized content level of 51 percent. Working to reach our goal, the support of partners such as Halliburton, through projects like this, is a clear sign of the commitment that will get us there,” he added.