Aramco and Rongsheng Petrochemical to Develop SASREF Plant

Paving the way for expanding Saudi Aramco Jubail Refinery Company (SASREF) in Jubail, global energy major Saudi Aramco signed a development frame work agreement with Rongsheng Petrochemical, an affiliate, of Rongsheng Petrochemical Co. Ltd in Beijing on Tuesday.

The tripartite agreement outlines the cooperation mechanism and planning relating to the design and development of the project, which aims to expand SASREF’s refining and petrochemical capabilities while fostering international collaboration.

Aramco Downstream President Mohammed Y Al Qahtani said that by aligning its efforts, Aramco and Rongsheng Petrochemical aim to deliver additional value to their stakeholders. This agreement underscores Aramco’s intentions to fostering closer collaboration with key partners and progressing its strategic downstream expansion, both in Saudi Arabia and internationally. It also highlights the potential of the Kingdom’s downstream sector to attract overseas players, he said.

Rongsheng Petrochemical Chairman Li Shuirong said that signing of the agreement set the stage for his company’s in-depth participation in the SASREF expansion project.

Saudi Arabia has abundant energy resources and significant market potential, and Rongsheng Petrochemical will bring strong momentum to the partnership through their excellent operation and management capabilities and market competitiveness.

“This collaborative project not only has important strategic value for the future development of both companies but will also make contributions to China’s Belt and Road Initiative and Saudi Arabia’s Vision 2030,” he added.

Aramco and Rongsheng Petrochemical Corporation signed a cooperation framework agreement relating to the planned formation of a joint venture in SASREF, as well as significant investments in the Saudi and Chinese petrochemical sectors.

Preliminary documentation relating to the development framework agreement was signed in September this year. This includes Rongsheng’s potential acquisition of a 50% stake in SASREF, the development of a liquids-to-chemicals expansion project at SASREF, Aramco’s potential acquisition of a 50% stake in Rongsheng affiliate Ningbo Zhongjin Petrochemical Co. Ltd. (ZJPC), and participation in ZJPC’s expansion project.

 The project, which is currently in the PREFEED stage, envisages construction of large-scale steam crackers and the integration of associated downstream derivatives into the existing SASREF complex, enhancing its ability to meet growing demand for high-quality petrochemical products.

China-Saudi Partnership

China has emerged as an important partner with the Kingdom in the last five years as the Saudi energy giant has foirmulated a strategy to boost its refining and petrochemical business.

Aramco CEO Amin Nasser said in August this year that his company was planning to pump new investments into chemical plants in China during the current and next two years, which will enhance the deals it has already signed in the Asian country to secure buyers with long-term contracts for its crude oil.

In September, Chinese Premier Li Keqiang announced his country’s willingness to deepen cooperation with the Kingdom in the oil, gas, petrochemicals and infrastructure fields.