Saudi Aramco and Total agreed to build a US$9 billion petrochemical complex next to an existing refinery in Saudi Arabia's Jubail region, in a move to expand the country's production capacity while reducing dependency on crude oil sales.
Saudi Aramco and Total agreed to build a US$9 billion petrochemical complex next to an existing refinery in Saudi Arabia's Jubail region, in a move to expand the country's production capacity while reducing dependency on crude oil sales.
The companies signed a preliminary deal to build a mixed-feed steam cracker with a capacity of 1.5 million tons per year of ethylene and invest around $5 billion, Total said Aramco said in a joint-statement. The cracker will feed other petrochemical and specialty chemical plants that will see $4 billion invested by third party investors.
The two partners are planning to start the front-end engineering and design (FEED) in the third quarter of 2018, the statement said.
In total, $9 billion will be invested in the project which will produce more than 2.7 million metric tons of high value chemicals, the companies said.
The complex will be integrated downstream of the SATORP refinery, a joint venture between Saudi Aramco and Total in Jubail, whose capacity increased from 400,000-barrel-per-day at its start-up in 2014 to 440,000-barrel-per-day today, in a move designed to fully exploit operational synergies.
The deal was signed during the official visit to Paris by Crown Prince of Saudi Arabia, HRH Mohammed bin Salman.
“The agreement deepens the exemplary relationship enjoyed by our two companies over many decades. It is one that has evolved from a standard buyer-seller arrangement to one imbued with common interests to further develop and diversify our businesses,” said Amin H. Nasser, president and CEO of Saudi Aramco.
“Our joint venture SATORP is a remarkably successful model of industry partnership and we are keen to build on this success to further underpin Saudi Aramco’s strategy to expand its capacity in the chemicals sector by 2030.”
“This project illustrates our strategy of maximising the integration of our large refining and petrochemical platforms and of expanding our petrochemical operations from low-cost feedstock, to take advantage of the fast growing Asian polymer market," said Patrick Pouyanné, Chairman and CEO of Total.
“Furthermore, this project will enable us to strengthen our ties with Saudi Aramco, with whom we successfully operate our biggest and most efficient refinery in the world. Finally, it will contribute to the Vision 2030 of the Kingdom by creating 8,000 jobs and bringing in new high-added-value technologies.”
Source: Pipeline ME
