New MDEA plant to take shape in Saudi following JV deal between Dow and Al-Hejailan Group

A memorandum of understanding (MoU) has been signed by Dow and the Al-Hejailan Group to form a joint venture (JV) company that will design, build and operate a methyl diethanolamine (MDEA) plant in the PlasChem Park in Jubail, Kingdom of Saudi Arabia.

According to a statement, the JV will enable Dow and Al-Hejailan to meet growing demand for natural gas purification in Saudi Arabia and in the broader Middle East region.

The JV is expected to be built and operated by the Al-Hejailan Group. As per the terms of the agreement, Dow will hold a 25% stake and Al-Hejailan will hold a 75% stake in the JV. The facility will leverage Dow’s manufacturing technologies, and Dow will be responsible for marketing of the plant’s production of MDEA. Construction of the plant is expected to begin in 2024, with a target to come online in 2025.

In November 2020, the Al Hejailan Group and Dow inked a deal to build and operate a new polyacrylic acid (PAA) and emulsion polymers plant at the Plaschem Park in Saudi Arabia.

“Saudi Arabia is a significant player in both the regional and global petrochemicals market, with further growth expected in the coming years. We are therefore delighted to sign this agreement with Dow, as it aligns with our group’s strategy of participating in the downstream industry,” said Faisal J. Al-Hejailan, CEO Al-Hejailan Group.

He added, “We also appreciate and recognise the leading efforts of the Ministry of Energy & the Royal Commission in allowing the multiple components of Saudi Arabia’s industrial base to work together to deliver on Vision 2030 in general, and this Al-Hejailan-Dow agreement in particular.”

Howard Ungerleider, President and Chief Financial Officer at Dow added, “This partnership is a demonstration of delivering solutions that will help advance the energy transition. We are excited for this opportunity with Al-Hejailan and appreciate the instrumental support of the Ministry of Energy & the Royal Commission.”

In December 2021, Sabic and OQ began a study for a new petrochemical project in Oman’s SEZAD.

In addition to the joint venture, Dow will also build a Dow-owned downstream manufacturing facility which will source raw materials from the new JV. This new facility will expand capacity of the company’s MDEA-based high performance UCARSOL products and will also blend Dow’s ACCUTRACE fuel markers for the region. This investment will position Dow to further enable local solutions for the energy transition, including delivery of industry leading gas treating, carbon capture, and fuel additive technology to the region. The facility is expected to come online in late 2024, the statement concluded.

In March 2022, the development of the UAE’s first methanol production facility was said to be underway following a deal between ADNOC and Proman.

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