Dow Chemical 2012 Annual Report Download - page 21

2012 Annual Report 19
Feedstocks
Sadara’s Performance-Focused Product Slate
Ethane
Liquid Feeds
Refinery Integration
Amines
Glycol Ethers
Propylene Glycol
Polyether Polyols
Isocyanates
Solution PE
LDPE
Elastomers
Water
Others
Performance
Materials
Performance
Plastics
Value Park
Building blocks
for advanced materials
applications
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Progress for Sadara Chemical Company, a joint venture
between Dow and Saudi Aramco, is on track. The world-class
integrated chemical complex is strategically positioned to
serve fast-growing regions in Asia Pacific, the Middle East
and Africa, and Eastern Europe. Its differentiated product
slate targets high-growth, technology-rich sectors.
The joint venture is projected to deliver estimated EBITDA
margins of 35–40 percent and average equity earnings for
Dow of approximately $500 million annually during the
first 10 years following its start-up.
Already, the project has achieved a number of milestones:
• Front-end engineering and design is complete.
• Product marketing and lifting agreements were signed
in 2012. Under the agreements, Dow will market and
sell the majority of products produced by Sadara outside
of the Kingdom of Saudi Arabia and the seven countries
defined as the Middle East Zone.
• Engineering and construction are on schedule. By the
end of 2013, the construction workforce will peak at
approximately 50,000 people, with the goal of bringing the
first production units online in the second half of 2015.
Sadara: Positioned to Serve High-Growth Regions and Sectors
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U.S. Gulf Coast
On the U.S. Gulf Coast, we are moving forward with our
comprehensive plan to further connect our U.S. operations
with cost-advantaged feedstocks from increasing supplies
of shale gas. Dow’s investments will increase our
global ethylene production capabilities by 20 percent –
strengthening the competitiveness of our downstream
businesses and growth in the Americas.
• In 2012, we achieved a major milestone with the December
restart of an ethylene cracker at our St. Charles Operations
(SCO) manufacturing facility near Hahnville, Louisiana.
The facility is expected to deliver a $150 million increase
in EBITDA in 2013 versus 2012.
• Plans for a new, world-scale on-purpose propylene
production facility at Dow Texas Operations are on track
for start-up in 2015. The PDH plant shifts feedstock
exposure from volatile propylene to abundant propane
and is expected to deliver significant margin expansion
for our Performance Plastics, Performance Materials,
and Coatings and Infrastructure Solutions segments.
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