Aramco, Partners to Construct Major Refinery, Petrochemical Complex in China

Officials sign an agreement to kick off construction of an integrated refinery and petrochemical complex in northeast China. (Aramco)
Officials sign an agreement to kick off construction of an integrated refinery and petrochemical complex in northeast China. (Aramco)
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Aramco, Partners to Construct Major Refinery, Petrochemical Complex in China

Officials sign an agreement to kick off construction of an integrated refinery and petrochemical complex in northeast China. (Aramco)
Officials sign an agreement to kick off construction of an integrated refinery and petrochemical complex in northeast China. (Aramco)

Aramco and joint venture partners NORINCO Group and Panjin Xincheng Industrial Group plan to start constructing a major integrated refinery and petrochemical complex in northeast China.

Huajin Aramco Petrochemical Company (HAPCO) is a joint venture between Aramco, NORINCO Group, and Panjin Xincheng Industrial Group.

It is developing a complex that would combine a refinery that produces 300,000 barrels per day and a petrochemical plant with an annual production capacity of 1.65 million metric tons of ethylene and 2 million metric tons of paraxylene.

Construction will start in the second quarter of 2023 after the project secures the required administrative approvals. It is expected to be fully operational by 2026.

Aramco will supply up to 210,000 bpd of crude oil feedstock to the complex, built in Panjin, in China’s Liaoning province.

Aramco Executive Vice President of Downstream Mohammed al-Qahtani said it was an important project to support China’s growing demand for fuel and chemical products.

“It also represents a major milestone in our ongoing downstream expansion strategy in China and the wider region, an increasingly significant driver of global petrochemical demand,” he added.

NORINCO Group Deputy General Manager Zou Wenchao said a large-scale refinery and petrochemical complex is a crucial project of NORINCO Group to implement and realize the joint development of the high-quality Belt and Road initiative, promote industrial restructuring, and enhance the oil and petrochemical sector to become stronger, better, and larger.

He noted that it would be necessary to deepen economic and trade cooperation between China and Saudi Arabia and achieve joint development and prosperity.

Panjin Xincheng Chairman of the Board Jia Fei indicated that the project is significant for Panjin to promote increasing chemicals and specialty products, strengthening the integration of the refining and chemical industry.

It is a symbolic project for Panjin as it seeks to accelerate the development of an essential national petrochemical and fine chemical industry base.

Meanwhile, Aramco CEO Amin Nasser stressed that China’s long-term energy security and high-quality development were among the company’s highest priorities.

Speaking at the China Development Forum 2023, Nasser said expanding Aramco’s oil production capacity by a million to 13 million barrels per day by 2027 will strengthen China’s long-term energy security.

He also noted that increasing gas production by more than fifty percent by 2030 should release an additional million barrels of oil daily for export.

The official said the global energy transition desperately needs realism and clarity, adding: “We welcome the pragmatic thoughts of Chinese President Xi Jinping on this.”

Aramco is already working on three major strategies to support China’s energy and development priorities.

The company recently launched a $1.5 billion venture capital sustainability fund to invest in advanced technologies to help all move closer to a net-zero emissions future.

“We are also evaluating an entry into liquified natural gas,” Nasser announced.

He highlighted the excellent example of the multiple and desirable opportunities for Chinese companies in the Kingdom in various energy and non-energy areas.

“More broadly, we are developing advanced, more sustainable materials such as those based on polymers and carbon to complement conventional ones while reducing their high cost,” he remarked.



Saudi Non-Oil Exports Hit Two-Year High

The King Abdulaziz Port in Dammam, eastern Saudi Arabia. (“Mawani” port authority)
The King Abdulaziz Port in Dammam, eastern Saudi Arabia. (“Mawani” port authority)
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Saudi Non-Oil Exports Hit Two-Year High

The King Abdulaziz Port in Dammam, eastern Saudi Arabia. (“Mawani” port authority)
The King Abdulaziz Port in Dammam, eastern Saudi Arabia. (“Mawani” port authority)

Saudi Arabia’s non-oil exports soared to a two-year high in May, reaching SAR 28.89 billion (USD 7.70 billion), marking an 8.2% year-on-year increase compared to May 2023.

On a monthly basis, non-oil exports surged by 26.93% from April.

This growth contributed to Saudi Arabia’s trade surplus, which recorded a year-on-year increase of 12.8%, reaching SAR 34.5 billion (USD 9.1 billion) in May, following 18 months of decline.

The enhancement of the non-oil private sector remains a key focus for Saudi Arabia as it continues its efforts to diversify its economy and reduce reliance on oil revenues.

In 2023, non-oil activities in Saudi Arabia contributed 50% to the country’s real GDP, the highest level ever recorded, according to the Ministry of Economy and Planning’s analysis of data from the General Authority for Statistics.

Saudi Finance Minister Mohammed Al-Jadaan emphasized at the “Future Investment Initiative” in October that the Kingdom is now prioritizing the development of the non-oil sector over GDP figures, in line with its Vision 2030 economic diversification plan.

A report by Moody’s highlighted Saudi Arabia’s extensive efforts to transform its economic structure, reduce dependency on oil, and boost non-oil sectors such as industry, tourism, and real estate.

The Saudi General Authority for Statistics’ monthly report on international trade noted a 5.8% growth in merchandise exports in May compared to the same period last year, driven by a 4.9% increase in oil exports, which totaled SAR 75.9 billion in May 2024.

The change reflects movements in global oil prices, while production levels remained steady at under 9 million barrels per day since the OPEC+ alliance began a voluntary reduction in crude supply to maintain prices. Production is set to gradually increase starting in early October.

On a monthly basis, merchandise exports rose by 3.3% from April to May, supported by a 26.9% increase in non-oil exports. This rise was bolstered by a surge in re-exports, which reached SAR 10.2 billion, the highest level for this category since 2017.

The share of oil exports in total exports declined to 72.4% in May from 73% in the same month last year.

Moreover, the value of re-exported goods increased by 33.9% during the same period.