ByTsvetana Paraskova– Apr 09, 2025, 10:30 AM CDT
Saudi oil giant Aramco and China’s top refiner, Sinopec, will expand a joint venture petrochemicals complex in Saudi Arabia under an agreement signed on Wednesday.
Aramco and China Petroleum & Chemical Corporation, as Sinopec is known, own the Yanbu Aramco Sinopec Refining Company (Yasref) on the west coast of Saudi Arabia, with Aramco holding 62.5% and Sinopec 37.5% in the venture.
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The companies signed on Wednesday a so-called Venture Framework Agreement (VFA), which will to pave the way for a major petrochemical expansion at Yasref, Aramco said in a statement.
The expansion project will create additional value through a state-of-the-art petrochemical unit, a large-scale mixed feed steam cracker with a 1.8 million tons per year capacity, and a 1.5 million tons per year aromatics complex with associated downstream derivatives integrated into the existing Yasref complex.
Both Aramco and Sinopec aim to diversify the use of crude oil into the production of petrochemicals, demand for which will continue to drive oil demand, while transportation fuel demand has started to level off in many major markets, including China.
“The planned Yasref expansion aligns with our downstream strategy to unlock the full potential of our resources, including converting up to four million barrels per day of crude oil into petrochemicals by 2030,” said Mohammed Y. Al Qahtani, Aramco Downstream President.
Yasref is just one of many refining and petrochemicals cooperation ventures between Saudi Aramco and Chinese energy firms.
Over the past two years, Aramco, the world’s biggest crude oil exporter and largest oil company, has signed agreements with China’s Rongsheng Petrochemical and Hengli Group to advance talks on cooperation in the refining and petrochemical sectors in China and Saudi Arabia.
In recent years, the Saudi oil giant has been pursuing deals to expand its international downstream presence, especially in demand centers such as Asia.
By Tsvetana Paraskova for Oilprice.com
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