Saudi Basic Industries Corporation (Sabic) has begun work on a $100 million technology centre in Shanghai, focusing on alternative energy and new materials for the construction and auto sectors.

Sabic's chief executive Mohamed Al Mady said yesterday the centre would focus on helping design and create next generation alternative energy vehicles.

It is part of a wider expansion that includes a polycarbonate production complex in Tianjin, a city in northeastern China as part of its joint venture with Sinopec, Asia's biggest refiner.

The company, which manufactures fertilisers, metals and polymers, has seen strong sales and solid profits on the back of higher oil prices.

Sabic is one of the world's largest chemical producers and its investments in China are part of a bigger energy partnership that includes a buildup of jointly run refineries as well as petrochemicals plants.

The development of China's electronics, automotive, building materials and new energy sectors is boosting demand for polycarbonates and other engineering plastics.

China produced only 220,000 tonnes of polycarbonate in 2010, importing most of the 1.13m tonnes consumed by its industries.

Even as China's growth slows, its national economic plans call for nurturing various 'new industries' such as renewable energy and electric vehicles.

'Material sustainability is key to the creation of new applications across industries,' Saudi Prince Saud bin Abdullah bin Thenayan Al Saud said during the Shanghai groundbreaking ceremony.

The new research centre, in Shanghai's developing research hub of Kangqiao, will share Sabic's research, design and production capacity with Chinese industries, he said.

With environmental sustainability in mind, the centre will be built with the highest global green standards in line with the guidance by the Leadership in Energy and Environment Design Gold Certification.-TradeArabia News Service