Aramco and SABIC to realign supply chain activities

Aramco and SABIC have announced their intention to transfer the marketing and sales responsibility for a number of Aramco petrochemicals and polymers products to SABIC, and the offtake and resale responsibility of a number of SABIC products to Aramco Trading Company (ATC).

The effect of these changes, planned to be implemented on a phased basis during 2021, subject to the necessary consents being obtained, will focus SABIC on petrochemicals products and ATC on fuel products.  

This is a significant step in aligning the Aramco and SABIC strategies, following Aramco’s acquisition of a 70 per cent stake in SABIC in June 2020.

Both companies will be prominent exhibitors at this year’s Arabplast trade fair, which will be held min Dubai on 15-18 November.

It is likely that these realignments will help boost efficiency in operations,  as well as strengthen the impact of brands and combined products. In which case, customers will benefit from improved product range and availability, as well as offerings such as ordering, supply chain, shipping reliability, and after-market services.

Ibrahim Al-Buainain, Aramco Trading Company President and CEO, said: “The transfers reflect our shared commitment to capitalise on the complementary nature of Aramco and SABIC’s respective product portfolios as we strive to create added value for our customers and shareholders … These changes will place us in an even stronger position to deliver market-leading innovation and value.”

Abdulrahman Al-Fageeh, SABIC Executive Vice President - Petrochemicals, added: “By leveraging and optimising our complementary combined product portfolios we will create a one-stop shop for the benefit of our customers globally, including in strategically important geographies, especially across Asia.”

Responsibility for the global marketing and sales of certain Aramco petrochemicals and polymers products and those of its joint ventures and affiliates will transfer to SABIC.

After completing the consolidation of petrochemical products, SABIC will market materials such as HDPE, LLDPE, LDPE, PP copolymer, PP homopolymer, PP terpolymer, ethylene vinyl acetate copolymer(EVA),  PMMA, PA6, MEG, DEG, TEG, Mono-Ethanolamine (MEA), Di-Ethanolamine (DEA), Tri-Ethanolamine (TEA), Ethylene diamine (EDA), DiEthyleneTriamine (DETA), ortho-Toluenediamine, Polymeric Methylene Diphenol Diisocyanate (PMDI), Toluene diisocyanate (TDI), Propylene Glycols, Polyols, Propylene Oxide, MMA, Butyl Glycol Ether, Acetone and Phenol.

Responsibility for the commercial aspects of liquid bulk marine shipping services will be consolidated under ATC (including chemicals and feedstock), while responsibility for the shipping of all solid products and customer product delivery will be consolidated under SABIC.