Dow to form JV with the Al-Hejailan Group in Saudi Arabia

Dow has signed a memorandum of understanding (MoU) to form a joint venture with the Al-Hejailan Group, a family business headquartered in Riyadh, Saudi Arabia, to design, build and operate a methyl diethanolamine (MDEA) plant in the PlasChem Park in Jubail, Saudi Arabia. 

The joint venture will enable Dow and Al-Hejailan to meet growing demand for natural gas purification in Saudi Arabia and in the broader Middle East region.

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.

“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. “We also appreciate and recognize 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.”

“This partnership is a demonstration of delivering solutions that will help advance the energy transition,” said Howard Ungerleider, president and chief financial officer, Dow. “We are excited for this opportunity with Al-Hejailan and appreciate the instrumental support of the Ministry of Energy & the Royal Commission.”

The joint venture is expected to be built and operated by the Al-Hejailan Group. Under the terms of the agreement, Dow will hold 25% stake and Al-Hejailan will hold 75% stake in the joint venture. The facility will utilize Dow’s manufacturing technologies, and Dow will be responsible for marketing of the plant’s production of MDEA. The construction of the plant is expected to begin in 2024 and to come online in 2025.