Investment Background – China-Saudi Arabia Capacity Cooperation Framework Agreement
∎ The Belt and Road Initiative of China
-Encourages Chinese companies to bring their capacity overseas
-Facilitates the “Going Abroad” process of supporting equipment
-Promotes the economic transformation and upgrading of China
∎ Saudi Arabia Vision 2030
-To reduce overdependence on oil
-To become one of the world’s 15 largest economies
-To lift the foreign direct investment to GDP ratio to 5.7% (the international level)
-To increase the private sector’s contribution to GDP to 65%
Location: Jazan City for Primary and Downstream Industries (JCPDI)
∎ The Project is an important part of the JCPDI’s development plan
∎ Projects in the JCPDI enjoy policy incentives
-One of the four petrochemical & energy-intensive industrial cities under Royal Commission management
-The Project will be landed in the JCPDI to align with Vision 2030
∎ Project land: rent is charged at a merely symbolic rate
-Energy supply: price advantages in utilities and other resources
-Financing support: long-term low-interest loans from the Saudi Industrial Development Fund (SIDF)
-Import tariff: machinery, equipment and raw material imports for investment projects are exempt from tariffs
-Local products are protected by government policies
-Tariffs are imposed on imported products
-Human resources: subsidies for staff salaries and training costs
Value Chain–Expanding to Upstream Industries
Phase I: Build PTA and PET Plants & Supporting Facilities
Oct. 2018-Aug. 2020
-PET Plant (500 ktpa)
-PTA Plant (1.25 mtpa)
-Water Treatment Unit
-High Pressure Steam Boiler, Pipe Network and Tank Unit
-Benzoic Acid Recovery Unit
-Product Storage & Transportation Unit
-Catalyst Preparation Unit and Cooling Water Unit
Phase I: Build a Heavy-Duty Vessel Company to Support the Factories in the JCPDI
Oct. 2018-Mar. 2020
-Heavy-Duty Vessel Manufacturer & Service Provider
-Heavy-Duty Vessel Company
-Main products (Vessels):
(1) Carbon Steel (CS)
(2) Stainless Steel (SS)
(3) Special Vessels
- Maintenance services for process pumps, agitators, dryers and other rotating equipment.
Phase II：Increase Production Scale Based on Utilities Built in Phase I to Improve the Overall Efficiency
Jun. 2019-Jun. 2021:
-New PET Plant (500 ktpa)
-New PTA Plant (1.25 mtpa)
Phase III：Expand to the Chemical Fiber Industry Based on Upstream Raw Material Advantages
Jul. 2021-Jun. 2024:
-PBT Plant (200 ktpa)
-Flat Thin Film Plant (200 ktpa)
-Polyester Chemical Fiber Plant (200 ktpa)
Signed a Conditional Site Allocation Agreement with the Royal Commission
Signed a Strategic Cooperation Agreement for the heavy-duty vessel project
Guangdong provincial leaders inspected the Project and met with Saudi government departments
Met with the Saudi Industrial Development Fund together with partners
Signed a Cooperation Framework Agreement with HQC of PetroChina
Accompanied the Royal Commission to meet with the Department of Commerce of Guangdong Province
Chairman Guan signed an Investment Agreement with H.E. Engr. Falih, the Minister for Energy of Saudi Arabia, at the Future Investment Initiative, marking a huge progress of the Project.
witnessed by the Saudi Crown Prince, Pan-Asia officially signed the PX Sale and Purchase Agreement with Saudi Aramco and signed the Loan Agreement with the SIDF at the NIDLP Launch Event.
groundbreaking ceremony for the project was successfully held at the project site in the JCPDI. Hundreds of guests, including leaders of the Chinese government and Saudi government and partners of the project gathered to witness this historic moment.
On April 24th, 2019, a Land Lease Agreement was signed by Chairman Guan (left) and Dr. Nassif (right), CEO of the Royal Commission at Jazan.
the permanent fence of the Project site was erected. Civil construction will be started soon.
a kick-off meeting of the Phase I of the Project is held. Pan-Asia and Kunlun, the contractor, have reached consensus that will achieve the operational goal of Phase I’s PET plant in full swing.
a grand mobilization meeting was held with major parties concerned, including the technology licensors, civil engineering and construction contractors and equipment suppliers. Pan-Asia and those partners will make collective efforts to roll out the Project as scheduled.
On September 8, 2019, the Piling Ceremony for the Phase I PET Plant of the Pan-Asia Saudi Petrochemical & Chemical Fiber Integrated Project was held at the project site in the JCPDI successfully.
On January 19, Pan-Asia and SCI Group signed a strategic cooperation framework agreement to establish Pan-Asia SCI Group (Saudi Arabia) Co., Ltd. under the witness of Mr. Zhou Yawei and Mr. Abdulhadi Aljuhani. SCI Group will become a shareholder of the Pan-Asia Saudi Project to facilitate the construction and operation commencement of the Project. The two sides will complete the review and approval procedures and sign a joint venture agreement as soon as possible.