MOSCOW (MRC) -- The Kingdom holds approximately one-fifth of the world’s proven oil reserves, which is considered to be the world’s largest reserve base, said Albawaba.
Saudi Arabia is producing more than two-third of the total GCC petrochemical capacity, the Gulf Petrochemicals and Chemicals Association (GPCA) reported recently.
Strong infrastructure, substantial reserves of cheaply extractable feedstock and supportive government policies help domestic producers to enjoy competitive advantage globally.
Despite challenging market conditions, the Saudi petrochemicals sector is continuing to show strong growth.
At the end of 2012, the sector accounted for more than 31.4% of the total market capitalization on the Saudi Stock Exchange, reaching at the level of SR 440 billion roughly.
SABIC (Saudi Basic Industries Corp.) is the flagship company among 14 listed companies, representing 61.2 of the total value of petrochemical sector.
SABIC is also the biggest petrochemicals company in the GCC region, reflecting 19.2 % of the total market capitalization on the Saudi stock exchange.
As MRC wrote earlier, Saudi Basic Industries Corp. (SABIC) may report a 14 % decline in annual profit, highlighting the petrochemical maker’s struggle with slowing economies in Europe and a resurgent U.S. chemical industry.
During 2012, Saudi Kayan commenced and expanded operational capacity of many commercial operations including olefins, ethylene glycol, polypropylene, high density polyethylene and Amines etc.
The company remained at top in terms of percentage growth. It’s revenue increased by 295 % to record SR9.5 billion.
Core operating profitability of petrochemical sector declined significantly, mainly due to decrease in overall product prices.
Total operating income for FY 2012 reported SR 53 billion compared with SR 64.25 billion for FY 2011, a decrease of 17.52 %.
Three out of 14 companies including , National Petrochemical (Petrochem), Sahara Petrochemical Company and Saudi Kayan showed operating losses during 2012.
On the positive side, Petrorabigh operating income increased exceptionally by 536 %, it achieved SR 654 million during FY2012 compared with SR103 million of FY2011.
Alujain Corporation’s operating income also increased by 127 % during 2012.
The petrochemical sector managed to earn an adequate margin of 10.9 %, generating SR 33.85 billion as net Income during fiscal year 2012. SABIC dominated the profitability, contributing SR24.7 or 73 percent of the consolidated value.
MRC