16 January 2012 04:56 [Source: ICIS news]
By Nurluqman Suratman
(adds details in paragraphs 3-4)
SINGAPORE (ICIS)--Saudi Aramco has signed a joint venture agreement with China’s state-owned oil refiner, Sinopec, to build a 400,000 bbl/day refinery in Yanbu on the kingdom's Red Sea coast, the country’s official news agency said over the weekend.
The project, named Yanbu Aramco Sinopec Refining (YASREF), will begin production in the second half of 2014, Saudi Press Agency (SPA) said in a report on its website.
YASREF will process Arabian heavy crude oil to produce refined products for the domestic and global markets, according to a separate statement by Sinopec.
The refinery will be able to produce 90,000 bbl/day of gasoline, 263,000 bbl/day of ultra-low sulphur diesel, 6,300 tonnes/day of petcoke and 1,200 tonnes/day of sulphur, Sinopec said.
State-owned Saudi Aramco will hold a 62.5% stake in the refinery and Sinopec will own the remaining 37.5%, SPA said.
The cost of the project should be within $10bn (€7.9bn) including debt, Khalid al-Falih, Aramco's CEO and president, was quoted as saying by Reuters at the project’s signing ceremony.
Meanwhile, Saudi Aramco is planning to invest in capacity additions abroad as well as new refineries in Al-Jubail and Jizan and the revival of a plan to expand the refinery in Ras Tanura, the Reuters report said.
"Over the next decade, our total global refining capacity is expected to approach 8m bbl/day," al-Falih was quoted as saying by Reuters.
China signed a number of energy agreements with Saudi Arabia on Sunday as part of a trip by Premier Wen Jiabao to key oil-producing countries in the Middle East.
A memorandum of understanding between SABIC and Sinopec was also signed over the weekend to build a plant to produce polycarbonate (PC) at Tianjin in China, the SPA said, without providing details.
An agreement between the two governments on the peaceful usage of nuclear energy was also signed, the SPA said.
($1 = €0.79)
Additional reporting by Fanny Zhang
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