Saudi Arabia’s fertilizer producer SABIC AN has approved the final investment decision (FID) for a major new urea plant with a production capacity of 2.6 million tonnes per year. Commercial production is expected to begin in the fourth quarter of 2030.
The new SABIC AN urea plant will also feature a 1.2 million tonnes per year ammonia facility and a post-combustion carbon capture unit, strengthening Saudi Arabia’s position in the global fertilizer market.
Construction of SABIC AN Urea Plant to Start in 2026
According to a stock exchange filing, construction of the new facility is scheduled to begin in the fourth quarter of 2026.
The project is expected to significantly expand SABIC AN’s existing urea production capacity. Once operational, the new plant will increase the company’s annual urea capacity from around 4.8 million tonnes to 7.4 million tonnes.
That represents an increase of more than 50% in SABIC AN’s urea production capacity.
New Facility Will Include Ammonia and Carbon Capture
In addition to the 2.6 million t/yr urea facility, the project will include an ammonia production unit with capacity of 1.2 million tonnes per year.
The facility will also incorporate post-combustion carbon capture technology. This is expected to support efforts to reduce carbon emissions associated with fertilizer production.
The integration of ammonia, urea and carbon capture facilities makes the project an important addition to Saudi Arabia’s fertilizer manufacturing infrastructure.
Saudi Arabia’s Urea Capacity Set to Rise
SABIC AN is currently the sole supplier of urea in Saudi Arabia. The company produces urea primarily at Jubail and exports a large proportion of its output to international markets.
However, disruptions caused by the ongoing conflict in the Middle East have also led the company to load urea from Yanbu on Saudi Arabia’s west coast.
According to estimates, SABIC AN exported approximately 4.1 million to 4.2 million tonnes of urea last year.
Earlier in March, SABIC AN also announced plans to incorporate the Ibn Al-Baytar plant into its existing portfolio. The move is expected to add slightly less than 500,000 tonnes per year of urea capacity.
Following that addition, the company’s overall urea capacity is estimated at just over 4.8 million tonnes per year.
Samsung Awarded $3.5 Billion EPC Contract
The engineering, procurement and construction (EPC) contract for the new SABIC AN facility has been awarded to Samsung.
The contract is valued at approximately $3.5 billion, making the project one of the significant fertilizer investments currently planned in the Middle East.
Construction is scheduled to begin in the fourth quarter of 2026, with commercial operations targeted for the fourth quarter of 2030.
QatarEnergy Also Planning Major Urea Expansion
SABIC AN’s project comes as several major fertilizer investments are being planned across the Middle East.
Excluding Iran, there are currently two major announced urea projects in the Middle East Gulf region that are expected to be completed by 2030.
In Qatar, QatarEnergy intends to develop a new urea complex that would double the country’s urea production capacity to approximately 12.4 million tonnes per year.
Consequently, the new projects by SABIC AN and QatarEnergy could substantially increase Gulf-region urea production capacity and strengthen the region’s role as a major global fertilizer supplier.
What the SABIC AN Project Means for the Global Urea Market
The expansion is significant because Saudi Arabia is already an important exporter of nitrogen fertilizers.
With the new 2.6 million t/yr urea plant, SABIC AN will have substantially greater production capacity by the end of the decade. Moreover, the addition of ammonia production and carbon capture technology could make the facility more integrated and potentially more efficient from an emissions perspective.
As global agricultural demand for nitrogen fertilizers continues to support urea consumption, additional production capacity in the Middle East could have implications for international fertilizer trade and supply.
Key Project Details
- Company: SABIC AN
- Country: Saudi Arabia
- New urea capacity: 2.6 million tonnes/year
- New ammonia capacity: 1.2 million tonnes/year
- Current urea capacity: Around 4.8 million tonnes/year
- Future urea capacity: Around 7.4 million tonnes/year
- EPC contractor: Samsung
- EPC contract value: $3.5 billion
- Construction start: Q4 2026
- Commercial production: Q4 2030
- Carbon capture: Post-combustion carbon capture unit
Conclusion
The approval of the final investment decision marks a major step forward for SABIC AN’s new urea plant in Saudi Arabia. With 2.6 million tonnes per year of additional urea capacity, a 1.2 million t/yr ammonia unit and carbon capture technology, the project is set to significantly expand the company’s production capabilities.
Once completed in 2030, the facility will further strengthen Saudi Arabia’s position as a leading global supplier of urea and nitrogen fertilizers.
