UPDATE 1-Exxon, Sabic JV petchem plant to cost $5 bln

* Exxon, Sabic JV petchem plant to cost about $5 bln

* Final investment decision on project by 2010 or 2011.

(Adds background and details)

DAMMAM, Saudi Arabia, Oct 5 (Reuters) - Exxon Mobil Chemical (FXON.PA) and Saudi Basic Industries Corp 2010.SE (SABIC) joint-venture synthetic rubber plants were expected to cost about $5 billion, a senior company executive said on Monday.

The project will have a combined production capacity of about 400,000 tonnes per year of carbon black, rubber and speciality polymers for both domestic and international sales.

"We are working on a five billion dollar project for elastomers... it goes into the tyre industry which will contribute to the downstream industry that will eventually be developed...like manufacturing tyres in this country," Marc Granier vice-president of Exxon Mobil Chemicals in Saudi Arabia told reporters at an industry conference.

The plants, which will be based at the Kemya complex in Jubail and the Yanpet complex in Yanbu, were expected to come online between 2013 and 2014, Granier said.

Granier said that they will take a final investment decision with Sabic by 2010 or 2011.

"I think we have some key check points with our partner and hurdles we have to overcome, probably we will go through an appropriation of these projects not before end of 2010 or even 2011," he said.

Granier said no contractor has been selected yet for the engineering work which hung on a final investment decision.

"We continue to work with Sabic to make the project viable. More information is needed like gas allocations and (to) find ways to reduce the cost below $5 billion."

Exxon and Saudi Aramco are investing $2.5 billion to reduce sulphur from diesel and gasoline at their joint venture refinery in Yanbu, Granier said.

"This will not change the capacity of the 400,000 barrel per day (bpd) oil refinery," he added.

The clean fuel project would come on stream in 2011 or 2012, Granier said.

(Reporting by Reem Shamseddine; Editing by William Hardy)