A petrochemical complex in Libya will be expanded and operated by a joint venture formed by Dow Chemical and Libya's state-owned National Oil Corp., the two companies announced Wednesday.

Dow Chemical Co. said it is the first global chemical company to take part in the economic development of the petrochemical industry in Libya since the north African nation embarked on a policy of attracting foreign expertise and investment.

Last month, Gadhafi moved to open Libya's decrepit, closed economy to world markets. Oil has made it the richest country in north Africa, but its hospitals, schools and roads are in poor condition, unemployment is estimated to be as high as 40 percent and more than one in six people live in poverty.

Enhancements at the Ras Lanuf petrochemical complex, built in the 1980s on the Mediterranean coast, will position the joint venture for growth as a world-class supplier of polyethylene and polypropylene, Dow said. The plastics are used in the manufacture of everything from packaging materials to plastic bottles to automobile interiors.

"We are very enthusiastic about the opportunity for Dow to participate in this project with NOC and work together to invest in this dynamic part of the world," Andrew Liveris, Dow Chemical's chairman and chief executive officer, said in a jointly released written statement. "This venture is consistent with Dow's strategy to grow its position in basic plastics and chemicals through joint ventures."

Midland, Mich.-based Dow Chemical initially will help upgrade and modernize existing buildings and equipment at the Ras Lanuf site. Later phases will include the construction of additional hydrocarbon, plastics and chemical production facilities.

The upgrades and expansion will develop more high-skilled jobs in Libya and stimulate investment in related industries, the two companies said.

"The partnership will bring a respected global company and its expertise together with a proven national enterprise to upgrade and produce world-grade products while enhancing the technical abilities of the Libyan work force," said Shukri Ghanem, National Oil chairman.

Libyan leader Moammar Gadhafi has made dramatic changes in his nation's foreign policy in recent years. The U.S. government had long viewed Libya as a terrorist-sponsoring adversary but resumed diplomatic relations after Gadhafi agreed in 2003 to abandon his programs to develop weapons of mass destruction and accepted responsibility for the 1988 bombing of Pan Am flight 103 over Lockerbie, Scotland, that killed 270 people.

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Related Project
Ras Lanuf Refinery
Facility Type: Refinery Owner: National Oil Corp. of Libya (NOC)
Scope: Expansion Location: Ras Lanuf Libyan Arab Jamahiriya