Aramco Overseas Company B.V., a subsidiary of Saudi Aramco, and PetroChina Company Limited, a subsidiary of CNPC, signed a Memorandum of Understanding (MoU) related to the planned development of a 10 million metric tons per annum (200,000 barrels per day) grassroots full conversion refinery in Yunnan Province in China.
The proposed refinery will be designed to process 200,000 bpd of Arabian crude oil and will produce high-quality refined products, such as ultra low-sulfur gasoline and diesel that meet current and future China products specifications.
Saudi Aramco says that the project represents an opportunity for it to partner with CNPC, China’s largest oil and gas producer, to support growing demand for high quality refined products and capture an investment opportunity in China’s refining industry. Additionally, it enhances a strategic partnership of close cooperation between a major producer and a major consumer of hydrocarbons while also presenting an opportunity for additional energy security and increased industrialization in the inner part of China.
This agreement is a significant step forward in our expanding relationship with CNPC and in our global downstream strategy. We don’t consider ourselves simply sellers of oil to China, but rather strategic partners whose many relationships in that important country are founded on mutual respect, interdependence and mutual benefit. We are proud to contribute to China’s steady economic growth and continued social development through our strategic long term investment and reliable supply of energy.—Khalid A. Al-Falih, Saudi Aramco's President and CEO
Saudi Aramco will supply the project company with up to 200,000 barrels per day of Arabian crude oil via a long-term contract while PetroChina will contribute its refined products retail network assets in the targeted market to the project company.
Saudi Aramco and China Petrochemical Corporation (Sinopec) also recently signed a Memorandum of Understanding (MOU) related to the ongoing development of the Red Sea Refining Company (RSRC), a world-class, full-conversion refinery in Yanbu’ on the west coast of Saudi Arabia. This refinery will process 400,000 barrels a day (bpd) of Arabian Heavy crude oil and produce high-quality refined products including 90,000 bpd of gasoline, 263,000 bpd of ultra-low sulfur diesel, 6,300 metric tons per day (MTD) of petcoke and 1,200 MTD of sulfur. (Earlier post.)
Owned by the Saudi Arabian Government, Saudi Aramco is a fully-integrated, global petroleum enterprise and a world leader in exploration and producing, refining, distribution, shipping and marketing. The company manages the largest proven reserves of conventional crude oil, 260.1 billion barrels, and the fourth-largest gas reserves in the world, 275.2 trillion cubic feet.