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Aramco unit to form JV with China’s Sinopec: Aramco Asia Singapore — a Saudi Aramco unit — inked an agreement with China’s state-owned Sinopec and its unit Fujian Petrochemical, to establish a USD 4 bn joint venture called the Fujian Sinopec Aramco Refining and Petrochemical Co, Reuters reported yesterday, citing a statement by Sinopec.
The details: The JV will cover port operation and crude oil transportation at their joint refinery and petrochemical complex in China’s Gulei Port Economic Development Zone, at Zhangzhou in southeast China’s Fujian province.
Who owns what? Sinopec is slated to put up CNY 7.2 bn (USD 1 bn), while Fujian Petroleum Chemical Industry will contribute CNY 14.4 bn (USD 2 bn) in banknotes, the newswire notes. Aramco Asia Singapore will supply the remaining amount — amounting to 25% of the JV’s registered capital.
SOUNDS FAMILIAR? Aramco and Sinopec kicked off construction work at a USD 9.82 bn refinery and petrochemical complex in the Fujian province back in November — with operations expected to begin in 2030. Aramco and Sinopec each hold a 25% stake in the venture, while Fujian Petrochemical holds the remaining 50%.
Project profile: The new refining hub includes a 320k bbl / d refinery, ethylene and paraxylene plants, as well as a 300k-ton crude oil terminal. Once operational, the facility is expected to supply some 5 mn tons of petrochemical feedstocks a year.
ICYMI- The initiative is separate from another USD 6.4 bn Sabic refining complex that is also situated in Gulei industrial park, Reuters explained.
Aramco is doubling down on downstream assets in China: The oil giant is “recalibrating”its petrochemicals portfolio and shifting its focus towards Asia, with the firm pursuing several downstream oil investments in China that look to lock in demand for Saudi crude in the long run. Aramco also sees demand for plastics and other petroleum derivatives growing in Asia and is angling for a larger market share in those markets. Saudi Aramco has set its sights on supplying 1 mn bbl / d of crude to China to supply petrochem investments.
