(MENAFN) Saudi Arabian Oil Co. (Saudi Aramco) has signed a deal with China's Norinco Group and Panjin Xincheng Industrial Group to form a joint venture called Hujain Aramco Petrochemical Co. The venture will construct a refinery and petrochemical complex in Panjin, Liaoning province, with Saudi Aramco owning 30 percent stakes, while Norinco Group and Panjin Xincheng Industrial Group will hold 51 percent and 19 percent shares, respectively.
The facility will combine a 300,000 barrels per day refinery with a petrochemical plant that has an annual production capacity of 1.65 million metric tons of ethylene and 2 million metric tons of paraxylene. The construction of this new refinery is expected to begin in the second quarter of 2023, and it is expected to be fully operational by 2026.
Aramco CEO Amin Nasser sees this as a win-win opportunity to build a world-leading, integrated downstream sector in China, with special emphasis on the high conversion of liquids directly into chemicals, as part of their broader liquid-to-chemicals business expansion plans. He believes that the project will support China's growing demand for fuel and chemical products and is a significant milestone in their ongoing downstream expansion strategy in China and the wider region, which is an increasingly significant driver of global petrochemical demand.
Saudi Aramco will supply up to 210,000 barrels per day of crude oil feedstock to the Liaoning refinery project. Norinco Group Deputy General Manager Zou Wenchao believes that the new venture will play an important role in deepening economic and trade cooperation between China and Saudi Arabia and achieving common development and prosperity.
Panjin Xincheng Chairman of the Board Jia Fei sees the project as of great significance for Panjin in promoting increasing chemicals and specialty products, strengthening the integration of the refining and chemical industry. The project is a symbolic one for Panjin as it seeks to accelerate the development of an important national petrochemical and fine chemical industry base.
Overall, the joint venture between Saudi Aramco, Norinco Group, and Panjin Xincheng Industrial Group represents a significant step in deepening economic and trade cooperation between China and Saudi Arabia. The construction of the new refinery and petrochemical complex in Panjin will not only support China's growing demand for fuel and chemical products but also contribute to the development of a national petrochemical and fine chemical industry base in the region.
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