Non-metallic & Chemicals Investment Opportunitiesiktva.sa/wp-content/uploads/2018/12/Non-Metallic-Chemicals-November... · SAES-Q-001 Criteria for Design and Construction of Concrete

Saudi Aramco: Public

Non-metallic & Chemicals

Investment OpportunitiesNovember 2018


The next slides contain forward-looking statements regarding future events based on current

expectations, estimates, forecasts, and projections. The data is subject to updating, revision, further

verification and amendment without notice. No reliance may be placed for any purpose on the

information or opinions contained in this presentation or any other document or statement, or on the

completeness, accuracy or fairness of such information or opinions therein. No representation or

warranty, express or implied, is made or given by or on behalf of Saudi Aramco or its employees, or

any other person as to the accuracy or completeness or fairness of the information or opinions

contained in this presentation and no responsibility or liability is accepted by any of them for such

information or opinions or for any errors, omissions, misstatements, negligent or otherwise, or for any

communication written or otherwise, contained or referred to in this presentation.

Disclaimer


Drives domestic value creation by working with suppliers for mutual benefits

Envisions to improve investment, and maximize long term economic growth and diversification

Focuses on delivering quality jobs, advancing innovation and enhancing global competitiveness

IKTVA is designed to reward Saudi Aramco’s suppliers for the use and development of local labor and sub-suppliers

Localization is a focus for the KSA – Saudi Aramco’s IKTVA program aims to achieve

70% local content by 2021


Agenda – Non-metallic

Session Title Presenter

Opening Salem Alghamdi, ID&SSD

Value Proposition 1: GFRP Rebar Farah Alturkestani, ID&SSD

Value Proposition 2: RTP Farah Alturkestani, ID&SSD

Value Proposition 3: Carbon Fiber Deema Albassam, ID&SSD

Value Proposition 4: Plastic Pallets Deema Albassam, ID&SSD


Agenda – Chemicals

Session Title Presenter

Value Proposition 5: Xanthan Gum

Investment OpportunityMohammed Altwaijri, ID&SSD

Value Proposition 6:Liquid Gilsonite

Investment OpportunityMohammed Altwaijri, ID&SSD

Value Proposition 7: H2S Scavenger Abdullah Abahusain, EXPEC ARC

Value Proposition 8: Proppants Khazisyed Ahmedjeelani, ID&SSD


Glass Fiber Reinforced

Polymer (GFRP) Rebar


Establish multiple state of the

art manufacturing facilities

for GFRP Rebar to serve

growing local and

international demand

Also opportunity exists to

become raw material supplier

for key ingredient such as

Direct Roving Fiberglass

The opportunity

1. Current KSA demand is

estimated at ~3,000 Tons per

year

2. Forecasted ~24% annual

growth in KSA demand

derived by Saudi Aramco

deployment strategy

3. Attractive cost base including

low logistics, land, utilities, and

labor costs

The business case

Source: Saudi Aramco

GFRP Rebar Manufacturing Represent an Attractive Opportunity Given The Current

Gaps, Expected Demand and Localization Potential


Life Cycle Cost Installation Reliability

GFRP Rebar Benefits

Significant potential for

cost savings due to

reduced maintenance

cost

Light weight, easily cut

machined, and

transported

Resistant to corrosion,

which increases the life

spam of concrete

structure


Saudi Aramco recently mandated the use of GFRP rebar for the non-critical applications and created

engineering and material standards for the use of GFRP rebar

Engineering Standards and Materials System Specification

Engineering Standard

SAES-Q-001

Criteria for Design and

Construction of Concrete

Structures

Materials System Specification

12-SAMSS-027

Fiber-Reinforced Polymer Bar

Materials for Concrete

Reinforcement

Slab-on-grade Side WalksDrainage

Channels

Coastal Structures

(Splash Zones)Pipe Sleepers Sea Walls

Saudi Aramco: Public10Source: Saudi Aramco Internal Analysis

Steel rebar demand in the Kingdom

is growing at a rate of 3.5%

annually.

Saudi Aramco’s demand for steel

makes up around 9% of the

Kingdom’s total steel demand6.38 6.61 6.84 7.08 7.33 7.58 7.85 8.12 8.41 8.70 9.01

0

2

4

6

8

10

12

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Millio

n T

on

s

KSA and Saudi Aramco Steel Rebar Demand

KSADemand

SaudiAramcoDemand

Steel Rebar Demand in the Kingdom is Growing at a Rate of 3.5% Annually

Saudi Aramco: Public11

• GFRP rebar is qualified to replace

10% of Saudi Aramco’s total steel

demand

• Deployment of GFRP is expected to

start in 2019 and grow at a rate of

24% to reach 23,000 Tons by 2028

• Wider adoption of GFRP rebar in

the kingdom will increase the

demand to potentially exceed 50-

100 thousand Tons annually.

Source: Saudi Aramco Internal Analysis

34

56

8

10

12

15

19

23

0

5

10

15

20

25

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Thousand T

ons

Saudi Aramco GFRP Deployment at Saudi Aramco

24%

GFRP rebar is to Replace 10% of Saudi Aramco’s Total Steel Demand


Key Ingredients are Available Locally and in GCC region

12Source: Saudi Aramco Internal Analysis

Value Chain Mapping

Vinyl Ester

Direct Roving Fiber Glass

GFRP Rebar

Benzene or

Butane

Silica Sand

Localization Opportunity

Available Locally

Key raw material are available

locally.

Potential exist to localize GFRP

Rebar manufacturing.


Value Chain Mapping Analysis

13

• Limited potential for

additional localization as

building blocks are produced

locally

• Potential exist for

manufacturing of direct

roving fiber glass which is a

key input in GFRP rebar

manufacturing. Also there is a

potential to localize VE.

• High potential exist to

establish multiple

production lines for GFRP

rebar to meet the growing

demand in the local market.

• Potential exists to further

develop logistics and supply

chain capabilities such as

• Long haul trucking

• Iso containers

• Loading and

warehousing

• High potential to localize the

following areas:

– Design

– Research and development

– Customer support and

services

– Installation support and

services

Raw Material IntermediateFinished Products

Transportation and Logistics

After Sales & Design

Services


Reinforced Thermoplastic

Pipe (RTP)


Establish multiple state of

the art manufacturing facilities

for Reinforced

Thermoplastic Pipe to serve

growing local and


Also opportunity exist to

become raw material supplier

for key ingredient such as

Direct Roving Fiberglass

The opportunity


estimated at ~1,000 KM per

year

2. Forecasted ~11% annual


derived



labor costs

The business case

Source: Saudi Aramco

Reinforced Thermoplastic Pipe Manufacturing Represent an Attractive Opportunity

Given The Current Gaps, Expected Demand and Localization Potential


Life Cycle Cost Installation Reliability

Reinforced Thermoplastic Pipes Provide the Following Benefits

RTP provide a lifecycle

cost saving of up to 200-

300% due to resistance

to corrosion and leakage

prevention

Faster installation time

and requires less

resources and man-

hours to install

More reliable due to

corrosion resistance and

reduced number of

connected joints


• The demand for RTP is

expected to grow in KSA

and the Middle East at a

rate of 11% annually.

• Technology improvements

will avail additional market

for RTP in the Oil ad Gas

industry.

Demand Forecast


1000 1096 12011316

14411579

17311896

20782277

24952734

667731

801877

9611053

11541264

1385

1518

1663

1823

0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

KSA and GCC RTP Demand

KSA GCC

Kilo

mete

r


Reinforcement Material

Fiber Glass

Applications: Water, Oil and Gas

Aramid Fiber


Carbon Fiber


Steel

Applications: Water, Non-sour Oil


Key ingredients are available locally and in GCC region.

HDPE/PERT

Direct Roving Fiber Glass

Reinforced

Thermoplastic Plastic

(RTP)

Polyethylene

(PE)

Quarts

Opportunity to localize

Key raw material are available locally.

Potential exist to localize intermediates

such as direct roving fiber glass and

Epoxy

Available Locally

Value Chain Mapping

EPOXY


• Key Raw material used in RTP manufacturing such as PE and Nylon is already available in the Kingdom.

• Low localization potential to establish additional facilities.

• Potential exist in becoming a reliable supplier of special grades HDPE needed by RTP manufacturers locally and globally.

• Potential exists to localize direct roving fiber glass, which is a key ingredient used in RTP and RTR manufacturing. Also opportunity for other applications such as wind turbine

• As demand is increasing for RTP, there is an opportunity to establish world class manufacturing facility in the kingdom in proximity to both customers and key raw material suppliers.

• Potential exists to further develop logistics and supply chain capabilities such as:

• - long haul trucking

• -Loading and warehousing

• There are no local companies specialized in the installation and maintenance of non-metallic pipelines. ..

• There is a high localization opportunity to establish companies specialized in RTP installation.



Installation and After Sale

Service



Carbon Fiber




of Carbon Fiber to serve

growing local and


The opportunity

1. Global demand is expected to

grow at 10% annually for the

next 10 years

2. New applications are going to

utilize Carbon Fiber including

Oil and Gas Industry and

Marine



labor costs

The business case

Carbon Fiber Manufacturing Represent an Attractive Opportunity Given The Current


Carbon Fiber Applications

Energy

Source: HIS Market Report

TransportationInfrastructure

Electronics

Sports


Carbon Fiber Applications

Carbon Fiber applicationsare expected to expand tonew sectors in the comingfew years

-

10,000

20,000

30,000

40,000

50,000

60,000

To

nn

s

Application

2018

2022

Source: Clean Energy Manufacturing Analysis Center Report


Carbon Fiber Demand Forecast

Carbon Fiber globaldemand is expected to growat a rate of 10% annually

83,16691,673

101,050111,386

122,780135,339

149,183

164,442

181,263

199,804

220,242

242,770

267,603

0

50,000

100,000

150,000

200,000

250,000

300,000

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Ton

sCarbon Fiber Global Demand

Source: Clean Energy Manufacturing Analysis Center Report


Value Chain Mapping

Naphtha PropyleneAcrylonitrile

(ACN)

Ammonia

Polyacrylonitrile

(PAN)

Pretreatment

Oxidation

LT Carbonization

HT Carbonization

Surface Treatment

Sizing

Winidng

Carbon Fiber

Intermediate Processing

Part Manufacturing

Opportunity to localize

Available Locally



Acrylonitrile

(ACN)

Carbon Fiber (CF)

Manufacturing Intermediate

Parts Manufacturing

• Opportunity exist in establishing

world-class acrylonitrile

manufacturing plant to serve

increasing global demand

• Leverage advantaged propylene

feedstock from refinery/ crackers

to lower cost

• Currently, Acrylonitrile is not

produced locally

• Establish multiple CF

manufacturing facilities to supply

local and regional growing

demand.

There are different manufacturing processes for Carbon Fiber Reinforced Plastics (CFRP) parts manufacturing. Trends shows opportunities exist in the following manufacturing Processes:

• Resin Transfer Molding (RTM)

• 3D Printing

• Other technologies

Potential applications include:

• Automotive parts

• Construction applications such as repairing stressed structures, rebars, cladding, and bridge construction

• Oil and gas applications such as pressure vessel, offshore platforms, and piping


Plastic Pallets




for Plastic Pallets to serve

growing local and


The opportunity


estimated at ~300,000 Pallets

per year

2. Forecasted ~4.4% annual


derived by Saudi Aramco

Deployment strategy



labor costs

The business case

Plastic Pallets Manufacturing Represent an Attractive Opportunity Given The Current



• Chemical products (spill pallet)

• Industrial parts (blind flange, valves)

• Warehousing: Transportation

(heavy duty)

• Airfreight shipping (light duty)

30

Plastic Pallets Applications

LogisticsStoring

Products DisplayFood & Beverages

Pharmaceutical Industries

• FDA have strict polices

• Sustain the required conditions for sanitary.

• Convenient to sterilize and clean• Less effort with lifting the products.

• Dimensionally stable for holding the product

for a extensive period of time.

Source: WeePallet Website


Pallet market size (in quantity sold) and

structure in 2015

3.8%

6.1%

7.4%

4.7%

Segment Growth1

• Plastic has the highest segment potential growth.

Plastic Pallets Globally

Corrugated Paper

2%

Metal2% Plastic

5%

Wood91%

Plastic

Metal

Wood

Corrugated Paper

+61%

2025

47.3

76.1

2016

Pallet market size in $ Bn

Source: Persistence Market Research, Technavio, BCG analysis


Plastic Pallets’ Benefits

Durability

Sanitation

Better logistics integration

Withstand different weather conditions, rot, chemicals

Easily cleaned and are less prone to contamination

Compatible with automated handling systems

Safer No screws, nails or splinters that

Longevity More than 10 year life span (3-5 years)

Key Advantages


• The demand on plastic

pallets is expected to grow

in the upcoming years in

Saudi Aramco

• Saudi Aramco is targeting

to replace 40% of the

wooden pallets with plastic

pallets

33

Plastic Pallets Demand Forecast

110,559 111,248 111,729 111,980 111,977 111,694 111,102 110,172 108,872 107,165

4,715 9,790

15,360 21,464

28,139 35,428

43,376 52,030

61,440 71,662

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Pallets

/year

Demand Forecast in Saudi Aramco

Plastic

Wood

+ 5%



• The demand on plastic

pallets is expected to grow

in the upcoming years in

SA

34

Plastic Pallets Demand Forecast

313,200 326,981 341,368 356,388 372,069 388,440 405,532 423,375 442,004 461,452 208,800 217,987

227,579 237,592

248,046 258,960

270,354 282,250

294,669 307,634

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Pallets

/year

Saudi Arabia vs. GCC Demand Forecast

GCC

SaudiArabia

+ 4.4%

Source: Saudi Aramco Internal Analysis, Takween Report


• Raw materials that are required for

plastic pallets e.g. polypropylene, and

HDPE resin are both available

locally. Opportunity exist in supplying

the material to pallet manufacturer

locally and globally

• High potential to localize highquality pallet manufacturer andsupply it to end users

• Injection Molding

• Compression Molding

• Thermoforming

• Potential exists to further develop logistics and supply chain capabilities such as storing, loading, and inside warehousing

Raw Material Pallets Manufacturing Transportation and Logistics



Key messages

In case you are interested in discussing this opportunity further, please contact

Please Direct All Inquiries To:

Deema Albassam

Nonmetallic Group

Saudi Aramco

[email protected]

Farah Alturkestani

Nonmetallic Group

Saudi Aramco

[email protected]

• Non-metallic sector is offering wide range

of attractive investments in the kingdom

due to availability of key raw materials,

competitive energy prices and future

growth prospect.

• Investments include GFRP rebar,

Carbon Fiber, Plastic Pallets and Re-

infroced thermoplastic pipes


Xanthan Gum Investment

OpportunityNovember 2018


Potential exists to establish

multiple production facilities in

the kingdom for Xanthan Gum

manufacturing

The opportunity



next 10 years

2. Wider market for Food &

Beverages, oil & gas etc..



labor costs

The business case

Xanthan Gum Manufacturing Represent an Attractive Opportunity Given the current

gaps, expected demand and localization potential


Xanthan Gum Global Applications

39

Others, 6%

Cosmetics, 2%

Pharmaceutical, 4%

Food and Beveragres, 71%

Oil & Gas, 16% Majority of the demand

comes from Food and

Beverage industries with

71% of global demand

Oil and Gas Sector comes

2nd with 16% of the

demand.

Global demand is 167

thousands tons



Global demand is expected

to grow at 3% annually and

will reach 224 thousands

tons by 2029

Xanthan Gum Global demand

40

167172

177182

188194

199205

212218

224

120

140

160

180

200

220

240

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

Th

ou

sa

nd

To

ns 3%



KSA demand is expected

to grow at 3% annually as

well and will reach 2,244

tons by 2029

Xanthan Gum KSA demand

41

1,6701,720

1,7721,825

1,8801,936

1,9942,054

2,1162,179

2,244

1,200

1,400

1,600

1,800

2,000

2,200

2,400

2,600

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

Ton

s

3%



Value Chain Process Mapping for Xanthan Gum

42

Fermentation PasteurizationSeparationPrecipitation

DryingMillingPackaging


• Low localization potential for Crop sources (Wheat)

•There is a potential to localize some intermediate processes such as:

•Glucose syrup

•Ammonium or Nitrate salts

•Protein

•Isopropyl alcohol

•High localization potential exists for Xanthan gum

• Potential exists for Transportation and Logistics Services

• After sales services to maintain quality as per specifications



After Sales Services

Value Chain Mapping Analysis for Xanthan GumSeveral gaps across the value chain of Xanthan Gum provide multiple opportunities to support chemicals production localization


Liquid Gilsonite

Investment OpportunityNovember 2018


Potential exists to establish


the kingdom for Liquid

Gilsonite manufacturing

The opportunity

1. KSA demand is expected to


next 10 years



labor costs

The business case

Liquid Gilsonite Manufacturing Represent an Attractive Opportunity Given the current

gaps, expected demand and localization potential


Value Chain Process Mapping for Liquid Gilsonite

Raw Material Transportation Sorting Processing Blending Liquid Gilsonite

• Gilsonite (as a mineral)

• Ethoxylated glycol

• Potassium hydroxide

Transportation and logistics process

It is a process to remove any large

size objects

It is a process to size the mineral and prepare for

blending

Add various chemicals and

Glisonite mineral to produce final

product

Final Product


At a global level,

drilling fluids

command lower

market share

due to very high

usage of

fracturing

chemicals in

North American

shale

production

Contribution of

drilling chemicals

to total spend

in Middle East

is higher than

global due to

higher

prevalence of

conventional

production

11%

30%

19%

30%

10%

Acidizing

Cementing &workover

Drilling fluids Proppants

Fracturing excl. proppants

Drilling & Completion Chemicals Market Breakdown

Global Market segmentation Middle East Market segmentation

21%

57%

5%

15%

Cementing & workover

Drilling fluids

Proppants

Acidizing


Drilling Muds are an important drilling and completion chemicals category,

accounting for ~57% of the Middle East market

Source: Saudi Aramco Internal Analysis, Report: Specialty Chemicals Update program

2%


Liquid Gilsonite KSA demand

KSA demand will grow

at 6 % and will reach

8,583 tons by 2029

4,7935,080

5,3855,708

6,0516,414

6,7987,206

7,6398,097

8,583

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

6%

Met

ric

Ton

s



•No existing producers to produce: Liquid Glisonite

•Local players : No manufacturers of Liquid Gilsonite for Drilling & completion

•No dedicated facilities in KSA for inspection, testing and certification of liquid Gilsonite

•No advanced maintenance providers with experience in Liquid Gilsonite formulation and blending equipment present in KSA

•Limited after sales support and/or technical assistance initiatives by either Liquid Gilsonite manufacturers and/or 3rd

party players

Raw MaterialFormulation and

Packaging

Maintenance, Testing and Certification

Technical Assistance

Value Chain Mapping Analysis for Liquid Gilsonite

Several gaps across the value chain of Liquid Gilsonite provide multiple opportunities to

support chemicals production localization


H2S Scavenger

Investment



Potential exist to establish


the kingdom for Additives

Manufacturing

The opportunity

1. Saudi Aramco demand is

expected to grow at 6%

annually for the next 10

years



labor costs

The business case

Several opportunities, across manufacturing and services, exist for H2S Scavangers


Additives (H2S Scavenger) have wide application across drilling and completion,

production and finished products

This value proposition will focus on additives for drilling & Completions

Additives for drilling and completion chemicals

Additives to ensure smooth production and transport

Additives to enhance properties of finished products

• The main products in the segment include

– Starches

– Powders and sands

– H2S Scavenger

– Mud thinners

– Liquid chemicals (polyamines etc.)

• The main formulated products in the segment include

– Pipeline drag reducers,

– Anti-icing agents

– Sulphur mitigating additives

• Gasoline (ethanol, octane boosters, deposit control, fluidizers etc.)

• Diesel (deposit control additives, cold flow improvers, lubricity improvers etc.)

• Aviation fuel (octane boosters, anti-icing additives, lubricity and conductivity improvers )


MM

To

n

H2S Scavenger Global demand is growing at 3% annually

Global demand is growing at

3% annually and will reach

296K Metric tons by 2029

220,736 227,358 234,179 241,204 248,440 255,893 263,570 271,477 279,621 288,010 296,650

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

3%

Met

ric

Ton

s



MM

To

nH2S Scavenger Saudi Aramco demand is growing at 6% annually

Saudi Aramco demand is

growing at 6% annually and

will reach 8K Metric tons by

2029

6%

4,864 5,156 5,465 5,7936,140

6,5096,899

7,3137,752

8,2178,710

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

Met

ric

Ton

s



Several opportunities, across manufacturing and services, exist for Additives ( H2S

Scavenger)

Loading

Transporting

Terminal operations &

storage

Supplier

Saudi Aramco currently manages its own logistics and transport and is willing to consider credible 3PL to provide additional services

SME opportunities Key features

• Offer customized on-site logistics

• Supplying iso-containers, conveyer belts, and drums

• Drive loading operations

• Offer state of the art monitoring and measuring systems

• Supplying advanced storage facilities such as tanks and drums

• Enhance value offering via reduced turnaround times

• Transport corrosion inhibitors via tank, drums, or iso-tanks

• Provide pipelines for the transportation of corrosion inhibitors

• H2S Scavenger can be stored in drums, with a capacity of ~13,000L, or in iso-tanks, with a capacity of ~24,000L

• Pumping, monitoring, and measuring equipment required to ensure smooth operations

• To control liquid flow and output to the storage tanks or the well site, different pressure pumps are used

• To manage high volume of H2S Scavenger transfer, manifold trailers are used

• H2S Scavenger can be transported in one of two ways:

– Tank, drum, or iso-tank storage and transported on cargo trailers, van trailers or flatbed trailers

– Pumping stations along a pipeline

H2S Scavneger and logistics value chain


Several gaps across the value chain provide multiple opportunities to support additives

production localization

Number of key molecules already available in KSA i.e

• Monoethanolamine

• Di-butlyamine

• Paraformaldehyde

No existing producers of synthesis compounds necessary to produce: H2S Scavenger and other main additives

Local players :

No manufacturers of additives for Drilling & completion fluids

There is opportunity for packing of these chemicals

•No dedicated facilities in KSA for inspection, testing and certification of additives

•No advanced maintenance providers with experience in additives formulation and blending equipment present in KSA

•Limited after sales support and/or technical assistance initiatives by either additive manufacturers and/or 3rd party players

Chemical SynthesisFormulation and

Packaging

Maintenance, Testing and Certification

Technical Assistance


Proppants

Investment



Potential exist to establish


the kingdom for Proppants

Processing

The opportunity



next 10 years



labor costs

The business case

Several opportunities, across manufacturing and services, exist for proppants


Proppants account for ~9% of a large Middle Eastern drilling and completion chemicals market

Over 90% of

proppants

are

consumed in

the Americas

due to

significantly

higher

fracking

activity

Proppants have

lower ME

demand

compared to

global due to

lower fracking-

this is expected to

change with

increases in

unconventional

production

11%

30%

19%

30%

10%

Acidizing

Cementing &workover

Drilling fluids

Proppants


2017 Drilling & Completion Chemicals Market Breakdown

Global market segmentation Middle East Market segmentation

21%

53%

15%

Cementing

Drilling fluids ProppantsAcidizing


9%2%

Source: Saudi Aramco Internal Analysis, Report: Specialty Chemicals Update program


Middle Eastern demand is

growing at 6% annually

and will reach 2.2 MM tons

by 2029.

In the Middle East, Proppants demand is expected to grow at a CAGR of 6%

ME Proppants expected market size evolution (2019-2029)

1,2681,342

1,4191,501

1,5881,679

1,7761,883

1,996

2,116

2,243

700

900

1,100

1,300

1,500

1,700

1,900

2,100

2,300

2,500

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

Vo

lum

e (

‘000 M

T)

564 589 634380 403 425 450 476 503 532 672Value($ MM)

6%



KSA demand is growing at

6% annually and will reach

1.7 MM tons by 2029.555

833

1,0881,178

1,230 1,2681,350

1,4251,515

1,6051,703

0

200

400

600

800

1000

1200

1400

1600

1800

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

Vo

lum

e (

‘0

00

MT)

Proppants demand in KSA is expected to grow at a rapid CAGR of 6% till 2029 as unconventional production increases

KSA Proppants demand market size (2019-2029)

Value($ MM)1

6 %

511369 380 405 427 454 481250166 326 353



Our goal is to optimize the total value delivered through fracking

1. Long-haul Transportation

2. Transloading 3. Trucking to well 4. Fracking operations

Description Proppant is transported by flatbed truck or rail cars (if available and cost effective)

Proppant is stored and/or transloadedto sand tankers for delivery to wells

Proppant is constantly delivered to well and offloaded at the rate of 4–5 trucks/hour

Proppant is conveyed from temporary storage to the operation

Supplier/ Port

Transloads(close to field)

Drilling pad321 Operations4

Smart Sand / Canadian Pacific unit trains

US Silica high-velocity transloading facility

12 Solaris mobile silos, 2500 ton capacity

Sand king

Typically managed by Proppant Manufacturer Typically managed by OFS

Logistics Chain for Proppant


Several gaps exist across the Proppants value chain presenting opportunities for localization

•Raw minerals required for proppants e.g. silica, alumina are readily available in KSA

•Limited processing of raw materials into products such as resin coated sand and sintered bauxite

•Very nascent market in KSA, with limited blending and formulation facilities

•Potential exists to further develop logistics and supply chain capabilities such as

-Long haul trucking

-Trucking to well

-Loading and storage

•Will typically be done directly by the OFS- staff and equipment will be from outside KSA.

•Potential to develop technical training institutes to develop local talent (e.g., Saudi Aramco drilling academy)

MiningProcessing and

FormulationTransportation and

Supply Chain Fracking Operation


Potential exists to establish multipleproduction facilities in the kingdom formanufacturing of:

• Xanthan Gum

• Liquid Gilsonite

• H2S Scavenger

• Proppants

Key messages

Mohammed Altwaijri

Industrial Development

Saudi Aramco

[email protected]

In case you are interested in discussing this opportunity further, please contact

[email protected]

Please direct all inquiries to

Khazisyed Ahmedjeelani

Industrial Development

Saudi Aramco

[email protected]


Thank you

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