Riyadh - Mubasher: Saudi Advanced Petrochemical Company on Thursday announced signing a long-term “take-off” agreement with American Vinmar International, Ltd. (Vinmar) to sell polypropylene.
The five-year agreement comes into effect 1 January 2019 and involves 175,000 metric tonnes of polypropylene in 2019, which will increase to 144,000 metric tonnes between 2020 and 2023, according to a bourse filing.
The deal will come into effect once the company’s current agreement take-off agreement expires on 31 December 2017.
The financial impact of the new agreement will be reflected in Saudi Advanced Petrochemical’s financial results for the agreed five years based on the market prices during those years.
The long-term agreement will bolster Advanced Petrochemical’s strategic plans and enhance the company’s profitability through better terms and conditions, the company’s chairman Khaifa Al Mulhem stated.
Advanced Petrochemical last reported near-stable profits of SAR 527 million in the nine months ended September 2017 compared to the year-ago period.
The Saudi petrochemical firm further added that its long-term 10-year off-take agreements with Japan’s Mitsubishi Corporation, which involves 150,000 metric tonnes per annum, and with Belgium’s Domo Investment Group, which involves 100,000 metric tonnes per year, have already been signed. The two deals also come into force 1 January 2019.
