VINACHEM

SAN ANTONIO, Texas (ICIS)--Performance chemicals are expected to see an annual demand growth of more than 10% in Saudi Arabia in the next few years, Koos Van Haasteren, executive vice president for performance chemicals at SABIC said late on Monday.

"Through our performance chemicals business, we are catering to very simple, basic needs," Van Haasteren said in an interview with ICIS on the sidelines of the International Petrochemical Conference (IPC).

"We all have to wash our hair," he said, referring to performance products such as ethanolamines used in shampoos, detergents and skin care products.

Besides the buoyant domestic market, SABIC is also targeting markets including the rest of the Middle East, Asia and northern Africa for its performance chemicals sales, said Van Haasteren.

He was undeterred by the recent political turmoil in countries such as Egypt, saying that he believed reforms in those countries would lead to lifestyle changes that would enhance the demand for performance products.

"By 2015, we want to become an established player not just in functional polymers such as polymethyl methacrylate (PMMA) and catalysts but also in base products such as acrylonitrile, methyl methacrylate (MMA) and acetone, which are important to the development of performance chemicals," said Van Haasteren.

The move towards energy efficiency and environmental compliance would enhance the demand for products such as isocyanates and polyurethanes, said Van Haasteran. The company has set up a polyurethanes training centre to complement its proposed world-scale isocyanates facility that is expected to start up in 2015.

SABIC is well placed to help the Middle East chemical industry rise along the value chain, with its building competence, marketing excellence, capital efficiency and technology ownership, he said.

The company has been investing a lot in the development of technology, in-depth knowledge of the market, as well as capital efficiency, he said.

"While we are always conscious that costs should not get out of hand, we also focus on people development and training," he added.

For example, SABIC has set up a product development and application centre in Riyadh that will collaborate with customers in the functional polymers segment.

The diverse group of speciality chemicals being produced at its affiliate Saudi Kayan complex is another indication of SABIC's commitment to enlarging its footprint in the performance chemicals business, said Van Haasteren.

Yet another example is the company's elastomers joint venture with ExxonMobil, which will produce speciality polymers, rubbers and carbon black.

SABIC is not ruling out the possibility of a functional polymer expansion of its performance chemicals overseas, with China, Europe, South America and India offering immense potential.

"In India, we already have a technology centre for functional polymers in Bangalore," he said.

Hosted by the National Petrochemical & Refiners Association (NPRA), the IPC continues through Tuesday.