Aramco and Total sign deal for $9bn petchem venture

JV partners to build new complex next to Satorp refinery in Jubail

Total and Saudi Aramco signed a deal for the engineering work at their $5bn new petrochemicals complex in Jubail, and announced a further $4bn of investment there. Reuters

Saudi Aramco and French oil major Total signed an agreement for the engineering and design of their $5 billion (Dh18.3bn) new petrochemicals complex in Jubail on the eastern coast of Saudi Arabia.

The partners said on Monday a further $4bn would be invested to provide feedstock for other petchems and speciality chemical plants located in the Jubail industrial area and beyond, further benefiting the Saudi economy.

“Today’s signing with our partner Total will deliver on multiple levels, from high-value fuels and petrochemical products never manufactured in the kingdom before and destined for consumers on three continents, to meaningful job creation for Saudi men and women,” said Amin Nasser, president and chief executive of state-owned energy company Aramco.

The complex – first announced in April – will be located next to the Satorp oil refinery, which is operated by a joint venture between Aramco (62.5 per cent owner) and Total (37.5 per cent owner), and is scheduled to launch in 2024.

The petchems complex is the first in the Arabian Gulf to be integrated with a refinery, with a capacity of 1.5 million tonnes per year of ethylene and related high-added-value petchems units, as part of Aramco’s strategy to develop downstream industries and diversify the kingdom’s economy in line with the Vision 2030 road map.

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“The petrochemicals sector has been undergoing significant growth globally and is one of the future growth engines,” Mr Nasser said.

“Satorp’s second-phase expansion represents a significant value addition in Saudi Aramco’s downstream strategy to maximise the full value of our vast resources portfolio and position the kingdom as a chemicals manufacturing and exports hub, supporting economic growth and diversification as part of Vision 2030.”