On January 2, Rongsheng Petrochemical Co., Ltd. and Saudi Aramco signed a Memorandum of Understanding in Dhahran, Saudi Arabia. According to the memorandum, the two parties plan to acquire the equity of each other’s subsidiary entities. This is a further deepening of cooperation after the two parties signed a series of cooperation agreements in March 2023, marking an important step towards investment cooperation in transnational entities.
The memorandum shows that the two parties are discussing Rongsheng Petrochemical (or its related parties)’s plan to acquire 50% of the equity of Saudi Aramco Jubail Refinery Company (“SASREF”), and plan to increase refining and chemical production capacity, improve product flexibility, and complex through expansion. degree and quality. At the same time, the two parties are also discussing the potential acquisition by Saudi Aramco (or its related parties) of no more than 50% of the equity of Ningbo Zhongjin Petrochemical Co., Ltd., a subsidiary of Rongsheng Petrochemical, and jointly develop the upgrade and expansion of existing equipment of Zhongjin Petrochemical and the development of new downstream Rongsheng Petrochemical Co., Ltd. Sheng New Materials (Zhoushan) project.
Saudi Aramco is an integrated energy and chemical company. Its crude oil production accounts for about one-eighth of the world’s production. Saudi Aramco also develops new energy technologies. Rongsheng Petrochemical operates the world’s largest single refinery Zhejiang Petrochemical’s 40 million tons refining and chemical integration project. It also has laid out the Ningbo Zhongjin Petrochemical aromatics project, Yisheng series PTA project, etc. It is an important polyester and new energy player in China and Asia. A manufacturer of materials, engineering plastics and high value-added polyolefins, it is the world’s largest manufacturer of PX, PTA and other chemical products. Its production capacity of polyethylene, polypropylene, PET, EVA, ABS, PC and other products ranks among the top in the world. . At present, Rongsheng is also planning new projects such as the upgrade and expansion of Ningbo Zhongjin Petrochemical and Rongsheng New Materials (Zhoushan). Acquiring the equity of Saudi Aramco’s refinery in Saudi Arabia and participating in its expansion project, while introducing Saudi Aramco to deeply participate in the construction of domestic projects, is an important strategic layout for Rongsheng Petrochemical to accelerate the global coordinated development of the petrochemical industry.
This cooperation between the two parties will not only bring more sufficient, stable and competitive petrochemical raw materials, more advanced chemical technology, and a more systematic and coordinated global industrial system to Rongsheng Petrochemical, but Rongsheng Petrochemical will also be able to use large-scale refining The construction and operation experience of chemical integration projects will help Saudi Aramco achieve its strategic goal of expanding the chemical industry chain.
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