Saudi Aramco has signed a memorandum of understanding to acquire a stake in a refinery in the eastern Chinese province of Zhejiang.
"We are exploring opportunities for new refining and petrochemicals facilities, making further investments in China," said Abdulaziz Al Judaimi, senior vice president, downstream at Saudi Aramco.
Saudi Aramco did not disclose the value of its stake in the Zhejiang Petrochemical’s new refinery project, however the holding is understood to be less than 15 per cent.
Saudi Aramco, the world's largest oil exporter has increasingly looked at refining and petrochemical investments in China, the world's biggest consumer of oil. The Saudi state company signed a long-term deal with Rongsheng, a petrochemical firm based in Zhejiang last month.
"This increase in customer base is due to our continuous focus and attention to the Chinese market,” said Mr Al Judaimi.
"We are also a major joint venture partner in a growing portfolio of refining and petrochemical assets in China,” he added.
Last month, Sabic, the Middle East's largest chemicals company signed a preliminary agreement to develop a large-scale petrochemicals complex in the Chinese province of Fujian.
The company, which did not disclose the value of the deal at the time said it was part of its strategy to "seek more investment opportunities and strengthen its position in the Chinese market."
Sabic, which is currently in the process of being acquired by state-owned Saudi Aramco has looked to increase its market share in China, investing around $1.8 billion in the country, primarily in compounding facilities and joint ventures with local firms.
The moves by Saudi Aramco and Sabic come amid an increasing shift in the world’s top oil exporting country towards selling more higher-margin products in Asia. China, the world’s top importer of oil is said to account for nearly half of all growth in the petrochemicals industry, which generated $2.27 trillion in revenues in 2017 alone, according to the China Petroleum and Chemical Industry Federation.
In June, Saudi Aramco along with Abu Dhabi National Company signed an agreement to jointly invest in a $44bn refinery on the west coast of India, along with some state-backed domestic refiners.