NONCONSOLIDATED AFFILIATES

9 Months Ended

Sep. 30, 2019

Equity Method Investments and Joint Ventures [Abstract]

The Company's investments in companies accounted for using the equity method ("nonconsolidated affiliates"), by classification in the consolidated balance sheets, are shown in the following table:



Investments in Nonconsolidated Affiliates	Sep 30, 2019			Dec 31, 2018
In millions	Sep 30, 2019			Dec 31, 2018
Investment in nonconsolidated affiliates	$	3,007		$	3,320
Other noncurrent obligations	(139		)	—
Net investment in nonconsolidated affiliates	$	2,868		$	3,320

EQUATE

In the first quarter of 2019, EQUATE Petrochemical Company K.S.C.C. ("EQUATE") paid a dividend of $440 million, reflected in "Earnings of nonconsolidated affiliates less than dividends received" in the consolidated statements of cash flows. As a result, the Company had a negative investment balance in EQUATE of $139 million at September 30, 2019, classified as "Other noncurrent obligations" in the consolidated balance sheets. At December 31, 2018, the Company had an investment balance in EQUATE of $131 million, classified as "Investment in nonconsolidated affiliates" in the consolidated balance sheets.

Sadara Chemical Company

In 2011, the Company and Saudi Arabian Oil Company formed Sadara Chemical Company (“Sadara”) - a joint venture between the two companies that subsequently constructed and now operates a world-scale, fully integrated chemicals complex in Jubail Industrial City, Kingdom of Saudi Arabia. The Company has a 35 percent equity interest in this joint venture and has been, and continues to be, responsible for marketing the majority of Sadara’s products through the Company’s established sales channels.

In 2017, Sadara achieved full commercial operations of all its facilities. In December 2018, the joint venture successfully completed its Creditors Reliability Test, an extensive operational testing program designed to demonstrate the reliability of the joint venture’s full chemical complex by operating at high rates for an extended period of time. While Sadara has reached these operational milestones and has been generating positive EBITDA (a non-GAAP measure defined as earnings before interest, taxes, depreciation and amortization), the joint venture has yet to report positive net income. During the fourth quarter of 2019, Sadara will commence an update of its strategic business plan, inclusive of updated financial projections, which will be reviewed with its board of directors. Sadara also expects to complete an impairment analysis of its long-lived assets which will include updated long-term cash flow projections from the updated strategic business plan as well as long term price assumptions from an independent third party, which are expected to be received in the fourth quarter of 2019. Based on these updated financial projections, Dow may also be required to evaluate its equity investment in Sadara for other-than-temporary impairment, which could result in an impairment charge up to the carrying value of the Company’s equity investment. At September 30, 2019, the Company’s equity investment in Sadara was $1,581 million.