Saudi Aramco, the world’s largest oil company, has initiated discussions with China’s Hengli Group regarding the potential acquisition of a 10 percent stake in Hengli Petrochemical. The companies signed a Memorandum of Understanding (MoU) on Monday regarding the proposed transaction, which aligns with Aramco’s strategy to expand its presence in key high-value markets like China. Hence, Aramco aims to advance its liquids-to-chemicals program and secure long-term crude oil supply agreements.
Hengli Petrochemical, a subsidiary of Hengli Group, owns and operates a 400,000-barrel-per-day refinery and integrated chemicals complex in Liaoning Province, China. Moreover, the subsidiary owns several plants and production facilities in Jiangsu and Guangdong Provinces, highlighting its extensive presence in key industrial regions.
Commenting on the MoU, Mohammed Y. Al Qahtani, Aramco Downstream President, said: “This MoU supports our efforts to grow our global downstream footprint. We continue to explore new opportunities in important markets, as we seek to progress in our liquids-to-chemicals strategy.”
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Al Qahtani added that Aramco looks forward to inking new partnerships with major market players like Hengli Petrochemical and expressed the company’s enthusiasm for expanding its presence in China.
This agreement also falls in line with Aramco’s efforts to increase its presence in the Chinese market following multiple deals in refining and petrochemicals. Earlier this year, Chief Executive Amin Nasser stated that the demand for oil in China is healthy and growing.
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