Aramco goes to China

09 November 2001

Saudi Aramcohas signed an agreement with ExxonMobil China Petroleumand Fujian Petrochemical Company (FPC)to prepare a joint feasibility study for the construction of a new worldscale ethylene steam cracker in the Fujian province of China. The agreement, which was signed on 15 November, marks a new departure for Aramco as the project will be the company's first major investment in petrochemicals.

The three partners will draw up proposals for the construction of a petrochemical complex alongside FPC's oil refinery in Quangang. The plant will comprise a 600,000 tonne-a-year ethylene cracker, polyethylene and polypropylene units, and chemical derivatives manufacturing units. FPC, a subsidiary of Sinopec, plans to expand capacity at its refinery to 240,000 barrels a day (b/d) from 80,000 b/d. The joint venture, which will be formed once approval has been obtained from China's State Development Planning Commission, will be responsible for the construction and maintenance of the combined facility. It will also market the petrochemical and petroleum products.

Aramco established a marketing office in Beijing in 1998. The company has two contracts for crude oil sales to China totalling 86,000 b/d. China also imports large quantities of liquefied petroleum gas (LPG) produced by Aramco, through third parties.

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