meed-logo

line1 line2 line3
SIGN IN / REGISTER

Aramco to begin tendering for Sasref expansion in Q2

14 March 2025

 

Register for MEED’s 14-day trial access 

Saudi Aramco is expected to begin the solicitation of interest (SoI) round for the main tendering process for a major expansion project of its affiliate, Saudi Aramco Jubail Refinery Company (Sasref), in the second quarter of this year.

The proposed project, which is part of Aramco’s $100bn liquids-to-chemicals programme, aims to convert the Sasref refining complex in Jubail Industrial City into an integrated refinery and petrochemicals complex by adding a mixed-feed cracker.

The project also involves building an ethane cracker that will draw feedstock from the adjacent Sasref refinery.

South Korean contractor Samsung E&A is performing pre-front-end engineering and design (pre-feed) and feed works on the project, based on a contract awarded by Aramco in March last year, according to sources.

The duration of the pre-feed and feed contract is understood to be 18 months, sources told MEED, adding that Aramco could be preparing to start the SoI process for the main engineering, procurement and construction (EPC) tender in the second quarter.

In November, Aramco signed a development framework agreement in Beijing with China-based Rongsheng Petrochemical Company for the Sasref integrated refining and petrochemicals complex project.

“The agreement outlines the cooperation mechanism and planning relating to the design and development of the project, which aims to expand Sasref’s refining and petrochemical capabilities while fostering international collaboration,” Aramco and Rongsheng Petrochemical said in a joint statement at the time.

Aramco, back in November, also confirmed that the project was in the pre-feed stage, adding that it envisaged that construction of large-scale steam crackers and the integration of associated downstream derivatives into the existing Sasref complex would enhance its ability to meet growing demand for high-quality petrochemical products.

The November agreement between Aramco and Rongsheng Petrochemical was the latest step in their joint investment in the Sasref petrochemical expansion project.

The two companies first signed a cooperation framework agreement in April to explore the formation of a joint-venture entity to invest in the project.

Rongsheng said it would potentially acquire a 50% stake in Sasref as part of that framework agreement. Aramco, in turn, would potentially seek to acquire a 50% stake in Rongsheng affiliate Ningbo Zhongjin Petrochemical Company (ZJPC), as well as participate in a planned expansion project of ZJPC in China.

Aramco and Rongsheng then signed preliminary documents in September related to the joint venture and Sasref expansion project.

ALSO READ: Regional downstream sector prepares for consolidation

Aramco and UK energy major Shell were previously joint owners of the Sasref refinery.

In April 2019, Aramco announced it had struck a deal with Shell to acquire the latter’s 50% share in the Sasref JV for $631m to take full ownership of the refinery complex. The Saudi energy giant has been the sole owner of the refinery since completing the transaction in September of that year.

Aramco already owns a 10% interest in Rongsheng through its subsidiary Aramco Overseas Company, based in the Netherlands. Rongsheng owns a 100% equity interest in ZJPC, which operates an aromatics production complex and has an interest in a JV that produces purified terephthalic acid.

Prior to signing the framework agreement with Rongsheng last April, Aramco signed a memorandum of understanding (MoU) with Hengli Group Company in April for the potential acquisition of a 10% stake in its subsidiary, Hengli Petrochemical, subject to due diligence and required regulatory clearances.

Aramco also signed preliminary documentation with Hengli for the potential stake acquisition.

Hengli Petrochemical owns and operates a 400,000 barrel-a-day refinery and integrated chemicals complex in China’s Liaoning province, as well as other plants and production facilities in Jiangsu and Guangdong provinces.

Aramco has been supplying crude oil feedstock to Hengli Petrochemical since at least 2018.

ALSO READ: Aramco and Chinese partners break ground on petrochemicals project

https://image.digitalinsightresearch.in/uploads/NewsArticle/13485243/main4918.jpg
Indrajit Sen

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles