Global Operational Transformation Sabic's Search for the Right Way to Master the Future
To meet future needs Sabic is optimizing its existing portfolio while at the same time investing in the innovations that are required for future growth. Moreover the company makes comments on a $30 billion oil-to-chemicals plant project.
Riad/Saudi Arabien – Sabic has started an global reorganization aimed at creating a more agile, cost-efficient, and customer-focused organization. As a result, the commodity products of the Innovative Plastics Strategic Business Unit (SBU) will now be housed in the Chemicals and Polymers SBUs. The remaining Innovative Plastics’ solutions will fall under a newly created SBU called Specialties. This business will serve as the exclusive home for SABIC specialty solutions. Along with the Performance Chemicals SBU, the portfolio of which was reallocated earlier, the Innovative Plastics SBU will cease to exist. This new organizational structure is expected to be in place by January 1, 2016.
“This reorganization will focus resources more intensively on the needs of each line, enhancing customer intimacy with more focused solutions provision and helping move Sabic to the next level of portfolio product management”, said Yousef Abdullah Al-Benyan, Acting Vice Chairman and CEO of Sabic.
One of the drivers of this change is the differing technology priorities of commodity and specialty businesses. The future of the commodity line will depend heavily on innovations around advancing feedstock technology. Specialty products face separate technology challenges, including the need to seek out technology acquisitions and partnerships or joint ventures that can enrich Sabic’s existing portfolio.
$30 billion oil-to-chemicals plant project
According to downstreamtoday.com Sabic expects to make a decision in the second quarter of 2016 on whether to go ahead with a $30 billion oil-to-chemicals plant project, its chief executive said. The industry portal refers to Reuters that Yousef Abdullah Al-Benyan, Sabic's acting vice chairman and CEO, said the economics of the project, whose potential investment size he confirmed, were being assessed and there was a 50/50 chance it would proceed. “It's a very large project, and that's why it requires more deep analysis and assessment,” he said. “This is the type of project that really you need to assess because current crude prices influence the outcome of the project.”