Albawaba – The Saudi petroleum giant, Aramco, has announced that it is in talks with Chinese firm Hengli Petrochemical regarding a potential acquisition of a 10 percent stake, entitled to the necessary regulatory permits and due diligence.
The two companies have signed a Memorandum of Understanding (MoU) on the planned deal, which Aramco says is in line with its aim to secure long-term crude oil supply arrangements, accelerate its liquids-to-chemicals programme, and increase its downstream footprint in important high-value markets.
Amin Nasser, Aramco’s chief executive, supported China against claims that it was "dumping" low-cost solar panels and electric cars on Europe during his speech at the World Energy Congress on Monday, as reported by Financial Times.
“China really helped by reducing the cost of solar energy,” said Nasser, adding that “A lot of what happened in solar panels is because of what China did in terms of reducing [prices],” noting that Chinese electric vehicles are costing up to a half of the competition and that globalization and collaboration are necessary to achieve the company’s energy goals by 2050.
China, which is the largest destination for Saudi crude and is becoming more significant for Aramco's goals of exporting 40 percent of its daily oil output according to the Financial Times, has been in increasing collaboration with Aramco in the past few years.
A joint partnership with the goal to construct an oil refinery and petrochemical facility in China's Liaoning province was established in March 2023 by Aramco, Norinco Group and Panjin Xincheng Industrial Group, with an estimated cost of $12 billion. Followed by a 10 percent stake acquisition of Chinese firm Rongsheng Petrochemical Co. for $3.4 billion in July.
“This MoU supports our efforts to grow our global downstream footprint,” said Mohammed Y. Al Qahtani, Aramco Downstream President, adding “We look forward to forging new partnerships and are excited by the prospect of expanding our presence in the important Chinese market.”
Pictured at the MoU signing are Janet Kong, Hengli Petrochemical International Pte. Ltd. CEO, sitting left, and Saleh Al Zaid, Aramco Asia Acting President, sitting right. Standing, from left, are Nasser Lasloom, Aramco Asia Senior Vice President of Downstream Business Development; Li Feng, Hengli Petrochemical Director, Vice General Manager and Board Secretary; Andrew Katz, Aramco Vice President of Downstream Growth & Development; Yasser Mufti, Aramco Executive Vice President of Products & Customers; An Jinxiang, Hengli Group General Manager; Nader Arfaj, Aramco China Acting Director; and Albert Lam, Hengli Petrochemical International Pet. Ltd Head of Origination and Business Development. (Aramco)
