LARGE-SCALE collaboration will have to come from the government and other sectors to fulfill the petrochemical industry’s goal of sustainability with the industry itself having to make significant contributions and investments, Sabic’s chief has said.

Mohamed Al Mady, Sabic vice chairman and CEO, said his company is integrating changes into its business strategy and priorities to position the company and the nation for the challenges faced now and in the future. This follows its recognition that sustainability megatrends will drive the need for change in business and national vision.

Speaking at a panel discussion on “Innovative Business Models in the Middle East” at the United Nations Framework Convention on Climate Change in Doha, Al Mady, Sabic vice chairman and CEO, said that to accomplish its sustainability mission, the petrochemical industry, including Sabic, would need to have strong involvement. “It will require collaboration with government and all contributors across the value chain. We need many solutions; but solutions to tough challenges have always been what businesses must provide if they expect to sustain themselves.”

Al Mady: meeting the vision

He said Sabic’s sustainability strategy will require the company to use finite natural resources more wisely and invest in renewal resources, especially energy; reduce the impact of the company’s manufacturing and distribution processes through energy and material efficiency and process innovation; enable customers, consumers and society at large to be more sustainable through the solutions that the company can provide by way of its products and technology, such as light weighting automobiles; and develop methods to close the lifecycle such that materials from the industry are reused over and over again.

Al Mady cited the King Abdullah University of Science and Technology (Kaust) as “one of the best examples” of national vision and sustainability. He praised the university’s vision to focus on major sustainability issues by bringing the best minds in the world together to develop solutions to major sustainability problems in solar energy, water purification, plant science and Red Sea biodiversity.  “We are proud of our alignment with Kaust and have built a research centre there to collaborate with the scientific network and talent that they have assembled. We have also developed research agreements with other Saudi and foreign universities to accelerate our innovation,” he said.

A second key example of national vision, he said, is the emphasis which the Saudi government is placing on a national energy efficiency plan. The government is addressing energy usage in the transportation, home air conditioning and industry sectors as targets for energy efficiency improvement.  Sabic is utilising its sustainability program to address the challenges of this mandate, he said.

Sabic ranks among the world’s top petrochemical companies. The company is among the world’s market leaders in the production of polyethylene, polypropylene and other advanced thermoplastics, glycols, methanol and fertilisers.

GPCA forum
Meanwhile, speaking at the seventh Gulf Petrochemicals and Chemicals Association (GPCA) forum in Dubai, Al Mady said the region’s petrochemical industry needed to  focus more on technology and innovation, offer customers more technologically advanced products and design products that meet global demand.

Sabic’s headquarters in Riyadh, Saudi Arabia

The region’s future competitive advantage will have less to do with feedstock price and supply and more to do with technology and innovation, he stressed. “We need to direct our efforts towards offering our customers more technologically-advanced and complex products. Our future success centres on our ability to reach out to customers looking for more sophisticated and technologically-advanced products.”

Al Mady said the global petrochemicals industry has worked hard to recover from the slump of late 2008 and early 2009. The Gulf petrochemical industry has also shown impressive strength and remarkable resilience, though still in its infancy.

Citing the increasing importance of sustainability, Al Mady said that it plays a significant role in the competitive landscape – providing more feedstock options and less waste.

He said many chemical companies have forced reduction in waste and improved efficiency, as energy and water costs have risen and government mandate has forced technological advances required for emission reduction. To remain competitive, a balance needs to be struck between the burning of hydrocarbons for electricity and water production and the development of value-added downstream industrial development, he pointed out.