SABIC, Saudi Aramco, Sinopec assess feasibility of developing petrochemical complex
Riyadh: SABIC has signed a memorandum of understanding with energy giant Saudi Aramco and China Petrochemical Corporation (Sinopec) to assess the economics and technologies of developing an integrated petrochemical complex at Yanbu’s existing refinery feasibility.
In a statement to the Saudi stock exchange, SABIC noted that the MoU is valid for 18 months.
The signing of the memorandum of understanding comes days after Chinese President Xi Jinping strengthened ties with Saudi Arabia during his visit to the kingdom.
China will also expand oil trade with Saudi Arabia, Xi noted, adding that his visit would be a historic milestone in China’s relationship with the energy-rich Middle East.
In addition to reaching an agreement with SABIC, Sinopec also signed a framework agreement with Saudi Aramco in December to build the second phase of a 16 million ton/year refinery project and a 1.5 million ton/year ethylene plant in Gulei, Fujian.
“These projects represent an opportunity to contribute to a modern, efficient and integrated downstream industry in both China and Saudi Arabia. They also support our long-term commitment to be a reliable supplier of energy and chemicals to Asia’s largest economy,” Mohammed Y. Al Qahtani, Saudi Aramco’s senior vice president for downstream operations, said in a statement.
Aramco said the announcements support its role as a reliable energy supplier to China as it seeks to expand its liquids-to-chemicals capacity to 4 million barrels per day by 2030. The statement also added that the cooperation is also in line with Sinopec’s efforts to become a world-leading energy and petrochemical company, providing high-quality products and reliable energy.
Sinopec President Yu Baocai said in a statement earlier that its cooperation with the Saudi Arabian entity is “a new milestone achieved through existing cooperation, demonstrating mutual trust and recognition among all parties, and enhancing their confidence in jointly tackling the energy transition.” .”
In early November, SABIC, along with Saudi Aramco, signed a preliminary agreement with Polish refining company PKN Orlen to explore the potential for joint investment in petrochemical projects in Poland and other European markets.
Last month, SABIC announced its intention to build a plant to convert crude oil into petrochemicals to take advantage of growing demand.
In a statement to Tadawul, SABIC said the crude chemical complex at Ras Al Khair is expected to convert 400,000 barrels of oil per day into chemicals.
Saudi Aramco owns 70% of SABIC and has been investing billions of dollars in downstream projects and petrochemical facilities.
In early December, Saudi Aramco cooperated with French oil giant TotalEnergies to build a petrochemical facility in Saudi Arabia, with an estimated investment of about US$11 billion.
A joint press release issued by the two companies stated that the petrochemical facility, called “Amiral”, will be owned and operated by the existing SATORP refinery in Jubail, on the east coast of Saudi Arabia.
Construction work on the Jubail petrochemical facility will start in the first quarter of 2023 and is expected to be operational in 2027. The facility is also expected to create more than 7,000 direct and indirect jobs.
