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Petrochemicals

With award-winning capabilities and credentials in project development and finance, acquisitions and divestitures, and disputes, Shearman & Sterling is recognized as a global leader in legal services for the petrochemicals sector. The firm's industry-facing team, which is seamlessly integrated across the Americas, Asia, the Middle East, Africa and Europe, has extensive, up-to-date experience of leading "first to market" transactions in all of the major petrochemicals-producing jurisdictions, and boasts an impressive client list comprising leading petrochemicals companies, national oil companies, financiers, investment and sovereign wealth funds, as well as contractors.

Shearman & Sterling has an unparalleled capability to advise on project development and financing, mergers and acquisitions and disputes involving the petrochemicals sector. With a long history of advising in developed jurisdictions such as the United States and Western Europe, the firm has also had a central role in the development of downstream oil and gas industries in the Middle East (where the firm has had an office since 1975), Africa and Asia. Our lawyers have deep knowledge of all aspects of the petrochemicals production and value chain, from technology licensing, to construction, feedstock and utilities procurement, marketing and offtake arrangements, and supply chain contracting. Our work has included the development and financing of some of the industry's biggest petrochemical projects worldwide, as well as acquisitions and divestments, joint ventures, restructurings and privatizations. We have extensive experience advising on matters in relation to major industrial sites, and on the complexities of integrated facilities in multiple ownerships. In terms of petrochemical financings, we have advised both sponsors and lenders on often complex, multi-sourced financings, spanning multiple time zones.

Recent projects on which the firm has advised include the development and financing by Dow Chemical and Saudi Aramco, in Saudi Arabia, of the US$20 billion Sadara Integrated Chemicals Project, the world's largest single-phase industrial project, comprising a world-scale mixed-feed hydrocarbons cracker and 26 separate downstream production units; a US$3 billion aromatics production project being developed by Indorama and ChemaWEyaat in the United Arab Emirates; fertilizer production plants around the world such as the FERTIL complex in Abu Dhabi; a complex butanol production joint venture in Saudi Arabia; the RAPID petrochemicals project being developed by PETRONAS in Malaysia and the Optimal joint venture in the same country; and EMethanex, a major methanol project in Egypt.
Recent major acquisitions and divestitures on which we have advised include the US$1.6 billion disposal by Dow Chemical of its "Styron" business to Bain Capital, the US$2.6 billion acquisition by BASF of Degussa's construction chemicals business, and BASF's US$5.6 billion acquisition of Engelhard Corporation.

High-profile disputes on which we have recently acted include Dow Chemical's US$2.1 billion arbitral award against a government for withdrawing from a proposed US$17 billion joint venture relating to Dow Chemical's polypropylene licensing and catalysts business.

Featured Matters

  • Sadara Integrated Chemicals Project, Saudi Arabia: The Dow Chemical Company as co-sponsor of this vast and complex project in a transaction which was awarded ‘Project Finance Deal of the Year’ 2013 at the IFLR Middle East Awards.
  • World-First Petrochemicals-Supported Sukuk, Saudi Arabia: The Dow Chemical Company on Sadara's SAR7.5 billion (approx. US$2 billion) sukuk in Saudi Arabia as part of a uniquely complex US$20 billion project financing.
  • SABIC's Acquisition of GE Plastics: Advised Saudi Basic Industries Corporation on its US$11.6 billion acquisition of GE Plastics from General Electric Company.
  • ABB Ltd: Advised ABB Ltd. in the sale of its upstream oil, gas and petrochemicals business to a consortium comprised of Candover Investments plc, JP Morgan Partners LLC and 3i Group plc.
  • World's Largest Publicly Announced Arbitral Award: Secured a US$2.1 billion award for Dow Chemical in the ICC arbitration brought against a wholly owned subsidiary of Kuwait Petroleum Company, stemming from its withdrawal from a planned joint venture with Dow.
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