Alujain gets energy ministry approval on feedstock allocation for new SAR 7.5 bln Yanbu project

Alujain Corp.  announced that it obtained, on Nov. 3, the Ministry of Energy's approval on feedstock allocation for the establishment of a new project in Yanbu Industrial City, according to a statement to Tadawul.   

The project includes a propane gas processing plant to produce propylene, a plant for the production of polypropylene (PP) and a complex to produce PP compounds and specialty materials.   

The total cost of the project is estimated at about SAR 7.5 billion ($2 billion), the statement said, adding that the project will likely start operation in the first half of 2026.   

The project, upon its completion, will produce more than 600,000 tons of PP and PP compounds, and specialized construction materials from polypropylene derivatives, in addition to about 25,000 tons of saleable hydrogen annually.   

Further, the project will connect the propylene and polypropylene production units of Alujain’s subsidiary, National Petrochemical Industrial Co. (NATPET), with the two production units in the new project to increase reliability and efficiency and improve economies of the two companies.   

The project also includes a strategic partnership with a leading global partner in the propylene and polypropylene industry. This partnership will allow the transfer of required technologies and know-how capabilities for the new project, including the establishment of a research and development (R&D) center for the specialty products (PP compounding and specialized plastic materials). This will contribute to meeting the needs of the local market, and creating future localization opportunities for specialized construction materials and specialty plastics covering medical applications, automotive industry and batteries manufacturing.   

With regard to the project’s current development phase, production technologies of the main units were selected and participants in the engineering, procurement and construction management (EPCM) of the project were shortlisted. Work is underway to start engineering designs for the main production units.    

Any material developments will be announced in accordance with the relevant regulations and instructions, the statement said.