Sinopec, Saudi Aramco to build $10 billion refinery in Saudi Arabia

Khalid al-Falih, Chief Executive Officer, Saudi Aramco.

DHAHRAN, SAUDI ARABIA: Saudi Arabian Oil Co and China Petroleum & Chemical Corp will develop a refinery in Saudi Arabia at a cost of as much as $10 billion and are in talks to build another in China. The 400,000 barrel a day plant is in Yanbu city and likely to start output in 2014. Sinopec is in talks with Aramco and Exxon Mobil Corp, its partners in the Fujian refinery in China, on plans to build a 240,000 to 300,000 barrel a day refinery. The partners also plan to expand capacity at the Fujian plant.

Aramco is participating in oil-processing and storage projects in China and in East Asia to take advantage of the region’s increasing consumption of fuel and crude. “The Fujian expansion includes upgrading of the refinery’s crude processing unit with ‘debottlenecking’ and expanding the ethylene cracker from 800,000 tonne a year to 1.2 million tonne a year. The companies will make an investment decision on the expansion in coming months. The Saudi plant will cost $8.5 billion to $10 billion, and financing hasn’t been finalized yet,” said Khalid al-Falih, Chief Executive Officer, Saudi Aramco.

© Bloomberg News