Saudi Arabia’s giant oil company Aramco and Chinese companies Sinopec Corp and Fujian Petrochemical have begun construction of a new joint petrochemical project in China. Asharq Bloomberg website reported on Monday that the project will be Gulei phase two in China, and is expected to start operating by 2030, according to a joint statement issued by the three companies.
The project includes an oil refinery with a capacity of 16 million metric tonnes per year, an ethylene production plant with a capacity of 1.5 million tonnes per year, and a paraxylene facility with a capacity of two million tonnes per year.
Aramco and Sinopec each own a 25 per cent stake in the project, while Fujian Petrochemical owns the remaining half.
Saudi Arabia’s Aramco and SABIC signed a preliminary agreement with China’s Sinopec in late 2022 to build a $6 billion petrochemical complex in Fujian. The three companies also signed a memorandum of understanding to study the economic and technical feasibility of developing a new petrochemical complex that will be integrated with the 400,000-bpd refinery on the Kingdom’s west coast in Yanbu.
China is important to the Saudi energy giant’s strategy to boost its refining and petrochemical business. The CEO of Aramco, Amin Nasser, expressed his goal in August to pump new investments into chemical plants in China during the current and next two years, which will enhance the deals it has already signed in the Asian country to secure buyers with long-term contracts for its crude oil.
In September, Chinese Premier Li Keqiang announced his country’s willingness to deepen cooperation with the Kingdom in the oil, gas, petrochemicals and infrastructure fields.
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