Saudi's Sabic to cooperate with EU on probe

Saudi Basic Industries Corp (Sabic), the world’s largest petrochemical maker, said it will cooperate fully with a European investigation into Saudi and Omani companies selling a material used in plastic bottles below cost after getting government subsidies.

The European Union opened probes on February 16 into whether Saudi and Omani makers of the material, polyethylene terephthalate, or PET, get trade-distorting government aid and sell below cost, a practice known as dumping. The European Commission started the investigation following a complaint from the Committee of PET Manufacturers in Europe.

“Sabic and its affiliated company Ibn Rushd are studying the complaint and will coordinate with the Saudi government, in preparing their response,” Samir Al Abdrabbuh, Sabic’s vice president for Corporate Communications, said an e-mailed response to Bloomberg News on Sunday. “Sabic and Ibn Rushd will cooperate fully with the European Commission investigation,” he said. They “are committed to complying with their obligations under international laws and treaties.”

The affiliate, Arabian Industrial Fibres Co, known as Ibn Rushd, 47.2 per cent of which is owned by Sabic, is the sole PET producer in Saudi Arabia.

Sabic didn’t say whether it’ll halt exports of plastics to the EU until the investigation is over, as it did during the anti-dumping investigation by India into Sabic’s polypropylene.

Sabic is expanding the capacity of the plant in the Red-Sea port city of Yanbu. After the expansion, Ibn Rushd’s PET capacity would rise to 750,000 tonnes per year from 330,000 tonnes per year currently, Sabic’s chief executive officer Mohamed Al Mady announced last year.