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Total, Saudi Aramco sign MoU to build $9bn petrochemical complex

PKBR Staff Writer Published 11 April 2018

French oil and gas major Total has signed a memorandum of understanding (MoU) with Saudi Aramco to build a petrochemical complex in Saudi Arabia, with an estimated investment of $9bn.

Planned to be built in Jubail, the new complex will be integrated downstream of the Satorp refinery in order to fully exploit operational synergies.

A joint venture between Saudi Aramco with 62.5% stake and Total with 37.5% interest, the Satorp refinery saw its capacity increased to 440,000-barrel per day from 400,000 barrel per day at its start-up in 2014.

Total said that the proposed complex will comprise a mixed-feed steam cracker with a capacity of 1.5 million tons per year of ethylene and related high-added-value petrochemical units.

Saudi Aramco president and CEO Amin Nasser said: “The agreement deepens the exemplary relationship enjoyed by our two companies over many decades. It is one that has evolved from a standard buyer-seller arrangement to one imbued with common interests to further develop and diversify our businesses.

“Our joint venture SATORP is a remarkably successful model of industry partnership and we are keen to build on this success to further underpin Saudi Aramco’s strategy to expand its capacity in the chemicals sector by 2030.”

The front-end engineering and design (FEED) work for the complex is planned to commence in the third quarter of 2018.

The firms noted that the new project, which is expected to create 8,000 local direct and indirect jobs, will produce more than 2.7 million metric tons of high value chemicals.

Total chairman and CEO Patrick Pouyanné said: “This project illustrates our strategy of maximizing the integration of our large refining and petrochemical platforms and of expanding our petrochemical operations from low-cost feedstock, to take advantage of the fast growing Asian polymer market.

“Furthermore, this project will enable us to strengthen our ties with Saudi Aramco, with whom we successfully operate our biggest and most efficient refinery in the world.

“Finally, it will contribute to the Vision 2030 of the Kingdom by creating 8,000 jobs and bringing in new high-added-value technologies.”

Image: Officials from Total and Saudi Aramco. Photo: courtesy of Saudi Arabian Oil Co.