Aramco Overseas Company, a subsidiary of Aramco, has acquired a 10 percent stake in China-based Rongsheng Petrochemical for $3.4 billion. The acquisition is in line with Aramco’s efforts to expand its downstream presence in China.
As part of the deal, Saudi Arabia will supply 480,000 barrels per day (BPD) of crude to the integrated refining and chemicals complex in China, which is owned by Rongsheng affiliate Zhejiang Petroleum Corp (ZPC).
Read more: Saudi strengthens strategic relations with China
Aramco downstream President Mohammed Al Qahtani said the acquisition is an important part of the company’s long-term growth strategy, expanding its presence in a vital market.
Rongsheng owns a 51 percent stake in ZPC. The latter has a processing capacity of 800,000 BPDÂ and a production capacity of 4.2 million metric tonnes of ethylene per year.
Rongsheng chairman Li Shuirong said the transaction marks an important step forward in the company’s internationalization strategy.
Huge projectsÂ
In March 2023, Aramco signed an agreement with its Chinese joint venture partners. NORINCO Group and Panjin Xincheng Industrial Group are the partners. The agreement is to build an oil refinery and petrochemical plant in north-east China. The facility will have a 300,000 BPD oil refinery. Additionally, it will have a petrochemical plant with an annual production capacity of 1.65 million metric tons of ethylene and two million metric tons of paraxylene. The city of Panjin in Liaoning province is the location of the facility.
Also in March, Aramco signed an agreement with Chinese partners. The agreement is for an oil refinery and petrochemical project in northeast China. They expect to start the project in 2026. Its purpose is to meet the country’s growing demand for fuel and chemicals. The project is expected to cost 83.7 billion yuan ($12.2 billion), partner Panjin Xicheng Industrial Group said in a statement on WeChat.
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