EXCLUSIVE: Petro Rabigh phase 2 to start operating in July

24 June 2018
Expansion project of the Saudi Aramco and Sumitomo Chemical downstream joint venture almost ready

Work on the second phase of Rabigh Refining and Petrochemical Company’s (Petro Rabigh) mega downstream complex in Rabigh, Saudi Arabia is nearly complete, a source close to the project has told MEED.

The Petro Rabigh expansion project is set to become operational in July, the source said, adding that Japanese Prime Minister Shinzo Abe could be attending the launch event next month.

Petro Rabigh is the joint venture (JV) between Saudi Aramco and Japan’s Sumitomo Chemical – in which both companies own 37.5 per cent shares each, with the rest being traded on the Riyadh Stock Exchange (Tadawul).

The Petro Rabigh refinery complex on the Red Sea coast is a topping refinery and consists of a 340,000 barrels a day (b/d) crude distillation unit, a 47,000 b/d hydrotreater, a 12 million cubic feet a day (cf/d) hydrogen plant, a 75,000 b/d naphtha merox unit and a 60,000 b/d kerosene merox unit along with supporting utilities, product tankage and a marine terminal.

The phase 2 expansion project will add 15 chemical plants to the Petro Rabigh complex, which will help the JV process an additional 30 million cubic feet a year (cf/y) of ethane and 3 million tonnes a year (t/y) of naphtha after the Petro-Rabigh phase II completion, which will provide the feedstock for chemical production.

Expansion of the main existing chemical plant and establishment of a clean fuels complex comprising polyether polyols, naphtha treating and Sulphur recovery units, are also part of the phase 2 project.

Saudi Energy Minister Khalid al-Falih had in December last year said that phase 2 would start operations in the first quarter of the year, although that could not be achieved due to delays in construction.

The project has been delayed, with the company in September 2016 announcing a six-month postponement until the second quarter of 2017, due to challenges being faced by the local construction sector as a result of low oil prices at the time.

That delay is estimated to have caused a cost increase of SR1bn ($267m) to the project, with the total capital expenditure rising to about $9.4bn.

When fully operational, Petro Rabigh Phase 2 is expected to achieve a 78 per cent Saudisation rate, as per the Saudi Vision 2030 programme, and create 28,000 jobs in total.

About 35 factories and derivatives units are expected to spring up in the larger industrial zone in Rabigh, in close proximity to the Petro Rabigh petrochemicals complex.

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