Saudi Aramco to turn Jeddah refinery into distribution hub

Saudi Aramco has started to turn its industrial complex in South Jeddah into a distribution center for petroleum products, shutting down the complex’s refinery business while maintaining operation of other facilities, the oil giant said in a statement.

The industrial complex comprises a number of facilities, including the 50-year old refinery, one of the Kingdom’s oldest.

The refinery has a production capacity of 80,000 barrels per day, accounting for 2.7 percent of the Kingdom’s total refining capacity.

Aramco decided to convert the complex into a distribution center to improve the performance of its facilities, it said in the statement.

The refinery has seen a decline in demand for fuel, Aramco’s senior vice president of downstream Abdulaziz Al-Judaimi said, adding that the complex’s proximity to residential areas and its economic inefficiency have prevented its expansion.

Aramco will supply the Makkah region with petroleum products from its facilities in Yanbu and Rabigh instead of the one in Jeddah, until the Jazan refinery starts operations in 2018.

The expected operation of the Jazan refinery, along with newly launched refineries such as Yasref in Yanbu and Satorp in Jubail, will provide more refining capacity to meet domestic demand with a total capacity of 1.2 million barrels per day.

Al-Judaimi noted that Aramco currently has a number of large-scale development projects underway to supply petroleum products to the Makkah region, including the establishment of a refined petroleum products collection and pumping center in Yanbu, the construction of pipelines from Yanbu to Jeddah, and the expansion of the North Jeddah distribution plant in Bremen.