King Fahd University of Petroleum & Minerals Prince Abdullah Bin Abdulaziz Science Park A New Era for Sustainable Technology-Based Development Presented at Japan Cooperation Council, Petroleum (JCCP) By Sadiq M. Sait King Fahd University of Petroleum & Minerals Dhahran, Saudi Arabia June, 2005 Bismillah arrahman arrahim Ladies and Gentlemen Firstly, I would like to thank Japan Cooperation Council (JCCP) for giving me this opportunity to address this esteemed audience and presents details of KFUPM science park. The objective of this presentation is to make the Japanese oil companies aware of the new initiative that KFUPM has taken in Dhahran, Saudi Arabia, the Capital of oil world. Joining KFUPM science park is an important corporate decision by Japanese oil companies. Once a Japanese company is in KFUPM science park, then there is a big chance that the company’s business will sustain and/or increase and/or new business opportunity will emerge. In this presentation I am going to touch on the changing role of universities in society and discuss how science parks fit into this new role by being agents of change and by supporting economic development and opening a new era for sustainable technology-based development. There is an expectation that the resources of universities should more effectively contribute towards economic development. This focus on universities comes from the much wider recognition that knowledge to the modern economy is what coal and steel were to the industrial revolution and universities are responding to this process by evolving systems for supporting this new role.

Presentation Outline Part I: Mission of the University Part II: Strategic Plan of KFUPM Science Park Part III: Progress and Status Gentlman, I will be presenting few slides on the introduction of Science Parks in general and touch base on the definition of Incubator and other concepts in Part I Part II will elaborate on the Vision, Mission, Objectives of PASP. The advances we have made PASP at KFUPM will be covered in Part III

Mission of the University A Balance between three key elements: Generation of new knowledge. Passing on this knowledge to future generations. Serving the needs of industry (business) and community. The most widely recognized roles for universities have been to generate new knowledge and to pass this on to future generations. What has now emerged is a third role for universities which is to serve more closely the needs of business and the community which includes contributing more to economic development.  In essence this new equilibrium between the elements in the mission of universities has come in part from the influence of government policy, in part from the pull of business that has recognized the value of knowledge and skills to their performance in highly competitive markets and from within universities themselves in response to the increasingly competitive environment in which they now operate.

Methods for Supporting Knowledge-Based Business Science Cities Technopolis High Technology Industrial Parks Science & Research Parks Business Incubators Research funding to the universities is build on the recognition that universities are one of the foundations to the knowledge economy. These “soft” investments sit alongside a number of “hard” initiatives across the world that are aimed at creating an infrastructure to support the commercialization of science and technology. A Science City is where a whole urban area is simply established as a new project to develop a science base that can then act as a foundation for economic development. Examples include Tsukuba City in Japan. A Technopolis is where a civic authority invests in a region with the specific intention that the region’s economic base should be founded on the commercialization of science and technology. Examples of projects of this type include Taedok in South Korea, the Sophia Antipolis in France and the very first of these projects which was established in Silicon Valley in California. A model initially developed in China is the High Technology Industrial Park. These projects were established to create zones that offer tax advantages to companies that invest in China;  

Strategic Plan of KFUPM Science Park The Vision of the Park The Mission of the Park Objectives PASP Site Benefits to KFUPM Benefits to Tenants Success Factors The vision is focussed on economics and knowledge based industries and make a significant contribution to the wealth & welfare of the Kingdom of Saudi Arabia through the development of knowledge based companies that will also strengthen the achievement of the mission of KFUPM to be a leading institution in the creation and dissemination of knowledge in its chosen fields of study (Petroleum/Petrochemicals and IT based fields)

Vision To make a significant contribution to the wealth & welfare of the Kingdom of Saudi Arabia through the development of knowledge-based companies Keywords: Closer ties and enduring links between academia and industry The vision is focussed on economics and knowledge based industries and make a significant contribution to the wealth & welfare of the Kingdom of Saudi Arabia through the development of knowledge based companies that will also strengthen the achievement of the mission of KFUPM to be a leading institution in the creation and dissemination of knowledge in its chosen fields of study (Petroleum/Petrochemicals and IT based fields)

Mission To develop a financially self-sustaining entity at KFUPM Development of an entrepreneurial culture Provision of space in the incubator and science park, and creation of self-sustaining facilities To develop financially self-sustaining physical and operational entity designed to create wealth through the commercialisation of scientific and technological knowledge from KFUPM; Development of an entrepreneurial culture amongst faculty, researchers, students, of KFUPM and providing technical, business, and financial advice to clients; Providing space in incubator and science park with access to university facilities and creation of a self sustaining and self supporting community of knowledge based companies Creating self employed businesses for young Saudi entrepreneurs by incubating their ideas and nurturing these incubatees in successful Saudi Entrepreneurs.

Objectives Providing an opportunity for national and Int’l organizations to enhance their business opportunities in the field of petroleum and IT. Utilizing the Kingdom’s industrial and market strengths in Petroleum and IT sector. Commercialization of University research. Providing incubator programs to young Saudis, and promoting emerging small-businesses. We have set our objectives to achieve an Overarching Goal by aligning our activities with objectives. Goal is that PASP becomes a reason for creating financially profitable entrepreneurial R&D culture in KFUPM and at the same time provide companies national and Int’l to expand their business based on R&D in the region. A new marketing strategy. Commercialization of University research and to act as a vehicle for entrepreneurs by providing a strong point of presence companies; Kingdom is a big market for multi-national petroleum and IT related businesses.We plan to utilize the Kingdom’s industrial and market strength for making KFUPM a focal point for attracting International R&D Personnel

Modes of Participation in Science Park Single-unit building Multi-tenant building Incubator building Single units are for mega multinationals like Schlumberger or Saudi Mega companies (Nippon Oil, Idemitsu, Cosmo, Chiyoda, JGC, SABIC and Saudi Aramco) Multi tenant building is for small companies and we plan to have laboratories available for those who need. It companies will only need offices. Incubator for young enterpreneures will be provided

PASP SITE The area of the site is more then 300,000 square Meters There will be 15 slots for 2500 square meters for major companies like Schlumberger, who will build there own building. The potential companies are Nippon, Shell, S. Aramco, SABIC, etc. Land Development and construction of four basic buildings is estimated to be SR 50 Million by P&M dept. KFUPM.

Chronology of Events KFUPM Science Park Project Committee Formed: 19/05/2002 Conceptual Plan Prepared: 15/09/2002 Foundation Stone by HRH Prince Abdullah Bin Abdulaziz: 20/10/2002 Project Awarded for Layout/Infrastructure Planning: 09/04/2003 Schlumberger Building Construction Ending: 01/10/2005 Incubator Program Launched: 01/06/2005 Intel to Open a Technology Center at KFUPM 01/02/2006 Chronology list is long and we have successfully completed three years of our existence. The effort has been on having a solid base by carefully planning, marketing, and understanding the local situation vis a vis international norms of science parks. The noticeable fact is that science park tenants have approached us before even we have planned for Park. This gave us advantages in understanding the type of tenants their requirement, benefit to PASP, and off course the problems encountered

What is in there for KFUPM? Joint research projects. Sharing of university laboratories. Custom-designed courses for tenants. Tenant staff in graduate programs. Adjunct appointments of industry experts in the University. Universities world wide have benefited technically and economically from science parks. PASP is expected to upgrade the R&D activities of KFUPM by creating a culture of industrial research by a two way street to University. Ideas/spin off of University research can be industrialized/commercialized by PASP tenant companies and KFUPM will get more of industrial projects from PASP tenant companies

KFUPM Research Strengths? Universities world wide have benefited technically and economically from science parks. PASP is expected to upgrade the R&D activities of KFUPM by creating a culture of industrial research by a two way street to University. Ideas/spin off of University research can be industrialized/commercialized by PASP tenant companies and KFUPM will get more of industrial projects from PASP tenant companies

Benefits to Tenant Firms Tenant companies can have a significant point of presence in the oil producing region Tenant companies can enhance their business opportunities in the region Availability of a skilled work-force pool from the student body, faculty members, and researchers Opportunity for commercial deployment of University’s intellectual property Access to the University’s facilities, i.e. research facilities, library, computer center, etc. Tenant companies can have a significant point of presence in the region especially from an R&D perspective Availability of a highly skilled work-force pool from graduate and undergraduate student body Assistance in identifying university programs and resources that best relate to the tenant’s research Opportunity for commercial deployment of university’s proprietary patents and innovations Access to the university’s advanced educational and training programs

KFUPM Pilot and Demonstration Plants Tenant companies can have a significant point of presence in the region especially from an R&D perspective Availability of a highly skilled work-force pool from graduate and undergraduate student body Assistance in identifying university programs and resources that best relate to the tenant’s research Opportunity for commercial deployment of university’s proprietary patents and innovations Access to the university’s advanced educational and training programs

KFUPM Laboratories The proximity with the academic departments producing hundreds of graduates in an area of expertise is a plus for larger companies who can have their research work contracted to the university. Sharing of expertise, etc., in return for using university labs, faculty, and students and the companies can donate equipment and tools Advising the activities of the university department by having Senior staff of tenant companies on University advisory committees Postgraduate studies and training can be offered to students by the tenants

Critical Success Factors Planning, leadership, commitment, & involvement of everyone, for the effective implementation of the plan. Close interaction between the tenant firms and the University. A clear management structure, with a Park Manager appointed at an early stage. Preference to companies in the areas of general strength of the University (Petroleum & IT). Critical success factor deals mainly with the strategic plan of the science park program. Planning, leadership, commitment and involvement of all concerned parties for effective implementation of the plan Close interaction between the tenant firms and the university A clear management structure with a Park Manager appointed at an early stage Preference to companies in the general strengths of the university

Part III:Progress/Status What to Expect? Major Companies Involved in KFUPM Current and potential tenants of PASP

What to Expect? University will be surrounded by some of the world’s leading technology companies Industry participation in academia The University will build on its current strengths due to proximity with industry Research & teaching programs will concentrate on modern high-technology The university will be surrounded by some of the world’s leading technology companies Industry participation in academia The university will build on its current strengths due to proximity with industry Research & teaching programs will concentrate on modern high technology

Major Companies Collaborating with KFUPM SABIC Saudi Aramco Schlumberger, USA Japan Cooperation Center Petroleum Ciba, Switzerland Others

International Companies in KFUPM Schlumberger (Construction is nearing completion) CIBA Specialty Chemicals, Switzerland. Japan Cooperation Council for Petroleum. Intel/KFUPM agree to open a technology center. Letters of Intent received: Cytec, The Netherlands. WIPRO, India. Institute Francais du Petrole (IFP), France. Membrana, Germany. DevCorp Int’l, Bahrain. Others Schlumberger is already here. Modest marketing campaign has resulted in Letter of Intents for joining PASP were received. We have only approached now those international companies who have Interaction with KFUPM There is a big potential of tenants in out side world

Proposal for Funding & Finance Given its ideal location and the explicit returns for the industry, the PASP-KFUPM Company is being formed with participation from: KFUPM Private Investments (Venture Capital) Saudi major companies (Saudi Aramco, SABIC, possibly others) The University would be responsible for establishment of standards for leasing, while the operation, maintenance and construction would be the responsibility of the PASP-KFUPM Company A company separate from the University should manage the Park (PASP). Financing for the Park has to be tailored to the resources of the initial partners who will form the Company to manage PASP and their ability to attract funding from other sources. Accepting that with finance comes control KFUPM as initiators of the project seek to find a Company structure and financial structure that will maximise their influence, consistent with the speed at which they wish to develop PASP.  

Governance & Management For effective management and governance, PASP-KFUPM Company will be formed based on the collaboration between three major parties: University: knowledge and resources. Industry: financing and R&D. Government: regulations and incentives. The Park will be managed as a commercial enterprise by a Park Manager, who heads the management team, and will be overseen by the Board of Directors of PASP-KFUPM. A Non-Profit seeking company should manage the Park in terms of establishment and operation on behalf of those stakeholders who come together to form the Company, e.g. KFUPM,Government, Investor,Saudi Aramco, etc.

Finally…. PASP is a strong statement of KFUPM’s determination to maintain its high standards. PASP initiative will couple the University with industry, and will create an environment with vast potential for joint technological R&D and enhancement of business opportunities for tenant companies. At the Science-Park, companies conduct research independently for their own motives, by their own researchers, utilizing their own facilities, and may involve University researchers & facilities, without intervention of University PASP is a strong statement of KFUPM’s determination to maintain its high standards in research, technological development and academic excellence PASP initiative to couple the University’s resources with the technological capabilities of the industrial sector, thereby creating a highly collaborative environment with vast potential for joint technological R&D With the establishment of this science park, KFUPM moves forward with a far-reaching initiative that will be a dynamic catalyst for technological development and collaboration between the university and the industry.

THANK YOU ! Contact: Dr. Halim Hamid Redhwi Chairman KFUPM Science Park (PASP) Committee KFUPM No. 1823, Dhahran 31261, Saudi Arabia Tel: +966 3 860-3840, Fax: +966 3 860-2259 Email: hhamid@kfupm.edu.sa Website:www.kfupm.edu.sa/sciencepark