Aramco + Sinopec begin construction on Fujian refinery, operation slated for 2030

Aramco + Sinopec break ground on USD 9.82 bn Fujian petrochems complex: Saudi Aramco and China’s state-owned refining giant Sinopec have kicked off construction work at a refinery and petrochemical complex in southeast China’s Fujian province, with operations expected to begin in 2030, according to a press release. The new refining hub is estimated to cost USD 9.82 bn, Reuters reports. Aramco and Sinopec inked a preliminary agreement for the greenfield project back in 2022.

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Who owns what: Aramco and Sinopec will each hold a 25% stake in the venture, while Fujian Petrochemical — a JV between Sinopec and the Fujian government — will hold the remaining 50%.

Project profile: The new refining hub is situated in Zhangzhou city’s Gulei industrial park and includes a 320k bbl / d refinery, ethylene and paraxylene plants, and a 300k-ton crude oil terminal. Once operational, the facility is expected to supply some 5 mn tons of petrochemical feedstocks a year. The initiative is separate from another USD 6.4 bn Sabic refining complex that is also situated in Gulei industrial park, Reuters explained.

Aramco is doubling down on downstream assets in China: The state-owned oil giant is “recalibrating” its petrochemicals portfolio and shifting its focus towards Asia, with the firm pursuing several downstream oil investments in China that look to lock in demand for Saudi crude in the long run. Aramco also sees demand for plastics and other petroleum derivatives growing in Asia and is angling for a larger market share in those markets. Saudi Aramco has set its sights on supplying 1 mn bbl / d of crude to China to supply petrochem investments, Aramco’s downstream president Mohammed Al Qahtani said.

Also from Aramco + China: Aramco inked agreements with Rongsheng Petrochemical and Hengli Group in September, advancing plans to expand the Saudi Aramco Jubail Refinery with Rongsheng and acquire a 10% stake in Hengli Petrochemical.