Saudi Aramco signed a framework agreement for a mutual acquisition deal with Rongsheng Petrochemical Group, according to a statement published on the Chinese group’s WeChat account.
Aramco plans to acquire 50% of the shares of Ningbo Zhongjin Petrochemical Company, a company wholly owned by Rongsheng, while the Chinese group intends to acquire 50% of Jubail Refinery, a unit wholly owned by the giant energy company in Saudi Arabia. Both investments are expansions of the projects subject to the deal.
Rongsheng said in a separate statement on Tuesday that the details of the investments are still unresolved, but indicated that progress had been made after the signing of memorandums of understanding between the two companies last January.
Aramco and Rongsheng cooperation
Last July, Aramco completed the acquisition of a 10% stake in Rongsheng Petrochemical Company for 24.6 billion yuan ($3.4 billion) through its wholly-owned subsidiary, Aramco Overseas. This acquisition came after the signing of strategic agreements between Aramco and Rongsheng Petrochemical, announced in late March 2023.
Rongsheng Company also owns a 51% stake in Zhejiang Company, which owns and operates a complex with a capacity to process 800,000 barrels per day of crude oil, and annually produces 4.2 million metric tons of ethylene, and Aramco is in talks to acquire 10% of it.
Aramco expands into China
This agreement also comes as the Saudi company works to increase its ability to convert crude oil into chemicals, and is trying to expand in the Chinese market, which is one of the world’s leading markets in the field of energy.
Saudi Aramco also entered into an investment partnership to develop a facility that includes a main refinery and an integrated petrochemical complex in northeastern China during March 2023.
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