Aramco eyes partnerships as it expands refining, petchem

Saudi Aramco is planning to increase investments in refining and petrochemicals to secure new markets for its crude, Reuters reported, citing a senior company executive.

The state-owned oil giant is moving ahead with multi-billion-dollar projects in China, India and Malaysia and aims to finalize new partnerships this year, Abdulaziz Al-Judaimi, senior vice president for downstream, Aramco, told the news agency.

Aramco intends to raise its refining capacity to between 8 million and 10 million barrels per day (bpd), from some 5 million bpd now, and double its petrochemicals production by 2030, he added. It pumps around 10 million bpd of crude oil.

“Our strategy is very simple. We want to be at 8 to 10 million barrels per day of participated (refining) capacity... (and) we are going forward by trying to be a top leader in chemicals by 2040,” Judaimi said.

In order to reach its target, Aramco has entered a 50 percent joint venture with three Indian refiners to build a $44 billion, 1.2-million-bpd refinery integrated with petrochemical facilities on India’s west coast.

Additionally, the company is working with Abu Dhabi National Oil Co (ADNOC) towards securing a partnership and expects to sign a memorandum of understanding (MoU) this year.

Meanwhile, Aramco is also taking a 50 percent stake in Petronas’ huge RAPID project in the southern Malaysian state of Johor, the report said.

The oil giant is also eyeing three separate refining and petrochemical projects in China. It is in talks with CNPC to finalize the purchase of a stake in a 260,000-bpd refinery in Yunnan, China, by year-end.

In its home country, Aramco is building a $20 billion petrochemicals company with Saudi Basic Industries Corp (SABIC) to convert crude oil into chemicals directly bypassing the refining stage.

Judaimi said Aramco would make a final investment decision by the end of 2019, adding, "This is a very critical program and we are going to do all we can to make it happen.”