Aramco signs agreement to potentially buy 10% of Shenghong Petrochemical

Saudi Aramco and Jiangsu Eastern Shenghong Co., Ltd. signed today, Sept. 27, a cooperation framework agreement to facilitate discussions on Aramco’s possible acquisition of a 10% strategic equity interest in Jiangsu Shenghong Petrochemical Industry Group Co., Ltd. (Shenghong Petrochemical) a wholly-owned subsidiary of Eastern Shenghong, subject to due diligence and required regulatory clearances.

Under the deal, Aramco would supply Shenghong Petrochemical with crude oil and potentially other feedstocks. Both parties also intend to cooperate on the development of a large expansion project, subject to further bilateral discussions and the conclusion of final binding agreements, according to an emailed statement to Argaam.

Shenghong Petrochemical owns and operates a 320,000 barrel-per-day integrated refinery and petrochemicals complex, a methanol-to-olefins and derivatives complex, as well as a purified terephthalic acid production facility through its wholly-owned subsidiaries. The facilities are co-located in the Xuwei Petrochemical Industrial Park in Jiangsu Province.

Eastern Shenghong, which is listed on the Shenzhen Stock Exchange, is a leading, vertically-integrated energy and chemicals enterprise, deploying advanced technologies in its new energy and materials businesses.

Aramco looks forward to partnering with Eastern Shenghong to supply the reliable energy required for China’s long-term growth, development and energy security, Mohammed Al Qahtani, Aramco Downstream President, said.

“The signing of this cooperation framework agreement is another significant milestone in Aramco’s Downstream strategy to increase conversion of Arabian crude oil to chemicals and to expand into the critically important Chinese market. We see China as an important partner not only for today but for decades to come,” he added.

Source : Argaam