DAMMAM, Saudi Arabia (Zawya Dow Jones)--A joint venture of Saudi Arabian Oil Co. and Dow Chemical Co. (DOW) will award all engineering, procurement and construction, or EPC, contracts on its $20 billion petrochemical complex to be built in Saudi Arabia by the second quarter next year, a top executive said Sunday.

About 50% of the capital investment amount is already under contract and "the rest are being tendered. And the awards will be first quarter and second quarter of next year," Abdulaziz Al Judaimi, Aramco's vice president responsible for chemicals, told reporters in Dammam.

Saudi Arabian Oil, the world's biggest oil company better known as Aramco, and Dow Chemical signed a joint venture shareholders' agreement Saturday to build one of the world's largest chemicals plants in the oil-rich kingdom's Eastern Province on the Persian Gulf coast.

Dow Chemical said in a statement earlier this week that "it is expected that all invitation for bids will be out by end of the year."

Construction of the 26 plants that will make up the chemical complex--known as Sadara Chemical Co.--is scheduled to begin immediately, with first output due to come on line in the second half of 2015 and full operation scheduled for the following year.

Sadara will produce polyeurethanes, propylene oxide, propylene glycol, elastomers, linear low-density polyethylene, low density polyethylene, glycol ethers and amines. Saudi Arabia is ploughing billions of dollars into developing its petrochemical industry in a bid to add value to its vast hydrocarbon resources and to create jobs for its young and growing population.

The Sadara project represents Aramco's second major investment in a large-scale petrochemical complex in the kingdom, where it is already involved in a joint venture with Sumitomo Chemical Co. (4005.TO) at Rabigh on the Red Sea.

-By Summer Said, Dow Jones Newswires; +966-546-842373; summer.said@dowjones.com

Copyright (c) 2011 Dow Jones & Co.

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