Aramco, China’s Rongsheng closer to buying stakes in each other’s units: Oil giant Aramco signed a framework agreement with privately-owned Chinese refiner Rongsheng Petrochemical to purchase stakes in each other’s units, the Chinese refiner said in a statement. The agreement comes months after the two parties signed an MoU in January to explore the possibility of the transaction.

What we know: The framework would see Aramco acquire a 50% stake in Ningbo Zhongjin, a unit of Rongsheng Petrochemical, while the Chinese refiner would take 50% of the Saudi Aramco Jubail Refinery (Sasref). No further details were provided on the financial details or expected timeline for the potential transaction.

About the units: Sasref was designed as an export refinery and has been wholly-owned by Aramco since 2019. It processes crude oil into petroleum products and produces 305k barrels per day (bbl / d) of oil. Zhejiang-based company Ningbo Zhongjin is a petrochemical complex that produces aromatic paraxylene, isobutane, liquid oxygen, petroleum coke, hexane, propylene, and other chemicals. The company’s primary market is China.

Aramco and Rongsheng are no strangers: Aramco closed last year the acquisition of a 10% stake in Rongsheng Petrochemical for USD 3.4 bn through its Netherlands-based subsidiary, Aramco Overseas Company.

And Aramco has been interested in Chinese refineries: Earlier this week, Aramco signed anMoU with China’s Hengli Group to explore acquiring a 10% stake in its subsidiary Hengli Petrochemical. It said last year that it aims to become a strategic investor in Jiangsu Shenghong Petrochemical through a potential acquisition of a 10% stake in the refiner which owns and operates a 320k bbl / d integrated refinery and petrochemicals complex. The interest in Jiangsu Shenghong came weeks after it signed a MoU with Shandong Yulong Petrochemical to discuss a potential 10% stake acquisition in the refiner which processes c. 400k bbl/d of crude oil.

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