Saudi Aramco has signed an agreement to form a joint venture (JV) with Norinco Group and Panjin Sincen to develop a fully integrated refining and petrochemical complex in the city of Panjin in China’s Liaoning province. Saudi Aramco will supply up to 70% of the crude feedstock for the complex, which is expected to start operations in 2024.
As per the agreement, the three partner firms will create a new company, Huajin Aramco Petrochemical Co. Ltd., as part of a project that will include a 300,000 barrel per day refinery with a 1.5 million metric tonnes per annum (mmtpa) ethylene cracker and a 1.3 mmtpa PX unit.
“Our agreement with Norinco and the Liaoning province is a clear demonstration of Saudi Aramco’s strategy to move from beyond a buyer-seller relationship, to one where we can make significant investments to contribute to China’s economic growth and development,” said Saudi Aramco CEO Amin Nasser in a press release.
“Our participation in the integrated refining and petrochemical project in Panjin will strengthen our collaborative efforts to enhance energy security, revitalise key growth sectors and industries in Liaoning and also meet rising demand for products and goods in China’s Northeast region,” Nasser added.
Saudi Aramco also has additional plans to establish a fuels retail business, which will further integrate into the value chain. By the end of 2019, a three-party Marketing JV Company is expected to be formed between Saudi Aramco, North Huajin and Liaoning Transportation Construction Investment Group Co., Ltd to develop a retail fuel stations network in the target markets.