Saudi oil giant Aramco and some Chinese companies have signed an agreement to develop a joint refining and petrochemical complex worth more than US$10 billion during Crown Prince Mohammed Bin Salman’s two-day trip to Beijing.
Aramco and China North Industries Corporation, officially abbreviated as Norinco, along with Panjin Sincen, agreed to create “the largest Sino-Foreign” joint venture.
The new complex will be located in the city of Panjin in the Chinese Liaoning province, and is set to start commercial operation in 2024, the Saudi company said in a statement.
The partners will set up a new company called Huajin Aramco Petrochemical Co. Ltd., as part of a project that will include a 300,000-barrel-per-day refinery.
Saudi Aramco will hold 35% of the newly formed venture, while its Chinese partners NORINCO and Panjin will hold 36% and 29% correspondingly, according to the deal.
Aramco vowed to supply up to 70% of the crude feedstock for the refinery.
The company also signed an agreement to buy a 9% stake in an 800,000-barrel-per-day integrated refinery and petrochemical complex in the Zhejiang province,
The multi-billion deal comes as Saudi Crown Prince Mohammed Bin Salman (MbS) wrapped up his visit to China, Saudi Arabia’s largest trade partner, as part of his Asian tour.
During his trip, the Saudi royal took a walk along the Great Wall before meeting Chinese President Xi Jinping.
China is Saudi Arabia’s top trade partner. However, when it comes to crude imports, Russia has remained the leading crude oil supplier to the country for the past two years, leaving the kingdom behind.
RT .com / ABC Flash Point News 2019.