Saudi Basic Industries Corporation – known as Sabic – the world’s second largest chemical company, is eyeing U.S. shale investments to shield itself from volatile prices of feedstocks. Sabic’s acting Chief Executive Officer Yousef al Benyan, disclosed that the company is looking for American partners to enter into joint ventures with, similar to the one entered recently with the Texas-based Enterprise Products Partners L.P.
“Given the volatility in oil prices, we are looking at ways to optimize our feedstock production,” Yousef Al Benyan said in a news conference in Riyadh.
As Bloomberg reports, the company is planning to secure feedstocks at competitive prices and use them in their operations in the U.S. or export them to the UK or other countries.
“The main areas in the U.S. we are looking to invest in are the northeast and the south as they fit our overall expectations including government support, labor laws and unions,” said al-Benyan. “At this point we are not looking to acquire any U.S. companies.”
Sabic is looking for foreign partners as the shortage of gas in Saudi Arabia limits the company’s drive for expansion. Despite that, al-Benyan said that it will not be directly involved in Saudi Arabia’s shale production, saying that the discovery of shale gas in the country will “open up some opportunities for indirect investments for Sabic.”
The company does not intend to invest in Iran, either, although it’s outlook on China – Saudi’s biggest trading partner last year – remains positive.
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