Aramco, TotalEnergies move ahead with petrochemicals project in Saudi Arabia

Saudi Aramco and France's TotalEnergies said they will move ahead with the construction of a petrochemicals complex called Amiral in Saudi Arabia that would have the capacity to produce up to 1.65 million mt/year ethylene on completion.

The facility will be merged with the existing SATORP refinery in Jubail, located on the country's eastern coast. The jointly-run refinery has the capacity to process 440,000 b/d of heavy, high sulfur crude oil.

It will comprise a mixed feed steam cracker integrated with the refinery and will also include two polyethylene units, a butadiene extraction unit and other associated derivatives units, the companies said in a statement Dec. 15.

Aramco and TotalEnergies will contribute $4 billion in equity to the $11 billion development, with the former's stake valued at 62.5% and the latter at 37.5%.

"With this collaboration we aim to expand the value chain by producing advanced chemicals more efficiently than ever before, accelerating industrial progress in the kingdom," said Amin Nasser, Aramco chief executive and president.

The new plant will provide feedstock to other chemical and specialty chemical plants located in the Jubail industrial area, Aramco said.

It is expected to enable a manufacturing hub, built with an investment of around $4 billion that would produce carbon fibers, lubes, drilling fluids, detergents, food additives, automotive parts and tires.

Downstream strategy

Aramco has been diversifying into more specialized high-value chemical products and less-carbon intensive hydrocarbon usage, and plans to convert up to 4 million b/d of crude oil to chemicals.

The company is also looking at opportunities for integrated refining and chemical ventures abroad, particularly with Chinese entities.

Aramco signed an agreement with Shandong Energy Dec. 9 to explore integrated refining and petrochemicals opportunities in China.

The companies will explore the potential development of a downstream hub in the eastern Shandong province, in addition to a possible crude offtake agreement.

Aramco is looking at a number of opportunities with China's state-backed Sinopec, Nasser said during an earnings call in March.

Aramco has an interest in China's downstream sector as it looks to lock in demand for its crude in Asia's largest economy. It decided in March to move forward with a 300,000 b/d oil refinery and petrochemicals project in northeast China.