Saudi Aramco has signed an agreement with state-run China Petroleum & Chemical Corporation (Sinopec) to establish a joint-venture company called Fujian Sinopec Aramco Refining & Petrochemical Company. The company will have a registered capital of $3.95bn.

The agreement was signed by Aramco’s Singaporean unit, Aramco Asia Singapore, Sinopec and its subsidiary Fujian Petroleum & Chemical Industry Company.

Sinopec and Fujian Petroleum & Chemical Industry Company will contribute $989.93m and $1.97bn in cash, respectively. The remaining amount, representing 25% of the registered capital of the joint venture, will come from Aramco Asia Singapore.

Fujian Sinopec Aramco Refining & Petrochemical Company will engage in port operation, crude oil transportation and other services related to the oil and gas sector.

The joint-venture agreement to establish Fujian Sinopec Aramco Refining & Petrochemical Company follows Aramco, Sinopec and Fujian Petrochemical Company Limited (FPCL) breaking ground on a greenfield integrated refining and petrochemical complex in China’s Fujian province in November last year.

The facility will have an oil refining output of 320,000 barrels a day (b/d) or 16 million tonnes a year (t/y). It will also feature a 1.5 million t/y ethane cracker and downstream units that can produce 2 million t/y of paraxylene and other derivatives. The complex will also consist of a crude oil terminal with a handling terminal capacity of 300,000 t/y.

FPCL will own a 50% stake in the upcoming Fujian refining and petrochemicals complex. The company is a 50:50 joint venture of Sinopec and Fujian Petroleum & Chemical Industry Company. Aramco and Sinopec will each hold a 25% stake in the project, which is expected to be operational by the end of 2030.

It is understood that Fujian Sinopec Aramco Refining & Petrochemical Company will mainly handle logistics and export of oil and chemical products from the under-construction Fujian refining and petrochemicals complex in China.

Separately, in early April, Aramco signed a venture framework agreement with Sinopec and Yanbu Aramco Sinopec Refining Company (Yasref) for a potential petrochemicals expansion of the Yasref refinery complex, located in Yanbu on the west coast of Saudi Arabia.

Aramco and Sinopec intend to establish a giant petrochemicals facility that will feature a large-scale mixed-feed steam cracker with a capacity of 1.8 million t/y and a 1.5 million-t/y aromatics complex, along with other associated downstream derivatives, integrated into the existing Yasref complex.

The Yasref refinery has a crude oil refining capacity of 400,000 b/d. Aramco owns a 62.5% majority stake in Yasref, with Sinopec holding the other 37.5% stake.

The signing of the Yasref petrochemicals expansion agreement coincided with the 10th anniversary of the refining facility’s commissioning.

“The project aims to maximise operational synergies and create additional value through introducing a state-of-the-art petrochemical unit. This is expected to enhance Yasref’s ability to meet growing demand for high-quality petrochemical products,” Aramco said in a statement on 9 April.

Aramco added that it seeks to advance ongoing engineering studies for the Yasref petrochemicals expansion project.

Prior to their venture framework agreement, the partners signed an initial memorandum of understanding for joint investment in the Yasref petrochemicals expansion project during the Future Investment Initiative conference in Riyadh in October 2023.

MEED understands that the Yasref petrochemicals expansion project, also known as Yasref+, is part of Aramco’s mammoth $100bn liquids-to-chemicals programme.