Sabic will have a 30 per cent equity share with the 70 per cent balance of ownership being retained by Maaden, according to a statement made available to Khaleej Times here on Saturday. The statement said that the project aims to utilise phosphate reserves in the north of Saudi Arabia to produce phosphate fertilisers in the Minerals Industrial City at Ras Az Zawr. The agreement was signed in Riyadh last week by Dr. Abdullah bin Issa Al Dabbagh, President and CEO of Maaden, and Mohammed Al Mady, Vice-Chairman and CEO of Sabic.

Dabbagh explained that the project consists of a phosphate mine and processing plant at Al Jalamid in the northern region of Saudi Arabia. There will also be a phosphate fertiliser production complex north of Al-Jubail at Ras Az Zawr. The statement quoted Dabbagh as saying that the "strategic alliance" between two major players of Saudi industry was a major boost for the Saudi fertiliser and mining industries. It will reinforce existing efforts for the development of an integrated industry and help in the exchange of technology, expertise and development programmes to optimise the utilisation of this vital resource. It will further drive long-term industrial progress, creating high quality Saudi products that are competitive in world markets.

He explained that Maaden will furnish technology and expertise in the phosphate industry while Sabic will provide technology and marketing expertise in the field of nitrogen fertilisers. Maaden recently signed contracts for the designing of sulphuric acid, phosphoric acid, ammonia and diammonium phosphate plants, producing 3 million tonnes per year of diammonium phosphate fertiliser (DAP) at the fertiliser complex in Ras Az Zawr. The complex, one of the world's largest single phosphate fertiliser complexes, is scheduled to go on-stream by mid-2010. The phosphate concentrate produced at the mine will be transported 1,200 kilometres to Ras Az Zawr by rail where it will be processed. The Public Investment Fund (PIF) is financing and supervising the construction of the new North South Railroad that will be used to transport the phosphate concentrates.

The phosphates ore reserves in the north of the country will be surface mined and have an estimated mineable resources of 1.6 billion tonnes in addition to further resources of 1.5 billion tonnes. Al-Mady reaffirmed the significance of strategic partnerships within national production sectors which follow the pattern of major alliances among global companies in the industrial world, aimed at strengthening their competitiveness.