South Korean conglomerate SK Gas has launched a three-way joint venture firm called SK Advanced with Saudi and Kuwaiti state firms.

SK Gas, Saudi Arabia’s Advanced Petrochemical Company(APC) and Kuwait’s Petrochemical Industries Company(PIC) jointly held a launching ceremony on Monday for a factory in Ulsan that will produce propylene through a process known as propane dehydrogenation. 

The factory, run by SK Advanced, aims to produce about 600-thousand tons of propylene. About 75 percent, or about 450-thousand of the production will be exported to China. 

SK Gas invested about one trillion won, or about 844 million U.S. dollars, in the factory. It convinced APC and PIC to invest a combined 220 million dollars in the project in order to create a stable flow of raw materials needed to produce the chemical, among other objectives.

The joint venture’s launch comes after President Park Geun-hye’s Middle East tour in March, when SK Gas signed an MOU with PIC. The joint venture is considered to be the first actual project based on an MOU signed during President Park’s visit to the region.