ISLAMABAD: Saudi Aramco on Monday expressed its plans to acquire about a 10-percent stake in a Chinese petrochemicals firm, a deal the Gulf energy giant stated was clear evidence of its “long-term commitment and friendship with China.
The agreement with Rongsheng Petrochemical occurs as Saudi Arabia, the biggest crude exporter in the world, enhances political relations with top importer China including a recent Beijing-brokered reconciliation with Iran.
Aramco deals with Chinese firms
A statement issued by Aramco stated that the deal guarantees the supply of 480,000 barrels (per day) of Arabian crude “under a long-term sales agreement” with Rongsheng.
Vice president Aramco Mohammed Al Qahtani said that the announcement demonstrated Aramco’s long-term commitment to the Republic of China and belief in the fundamentals of the petrochemicals sector of China.
News of the Rongsheng Petrochemical deal came one day after Aramco announced the company would partner with two other Chinese firms to build a refinery and petrochemical plant in the northeastern Panjin city of China.
That facility “is likely to be fully operational by 2026”, as per the statment issued by Aramco.
Speaking at the China Development Forum in Beijing on Sunday, CEO Aramco Amin Nasser stated that the firm, a leading source of income for Saudi Arabia kingdom, was “doubling down on China’s energy supply”.
“We see a major win-win opportunity window to build a world-leading, integrated downstream sector in China, with special focus on the high conversion of liquids into chemicals directly as part of our broader liquid-to-chemicals business expansion plans,” Nasser further said.
Fighting Carbon Emissions
The firm Aramco, which is mostly state-owned and said it got record profits totalling $161.1 billion in 2022, has pledged to achieve “operational net-zero” carbon emissions before 2050.
That applies to emissions that are produced directly by Aramco’s industrial sites but not the CO2 produced when clients burn Saudi oil in their cars, furnaces and power plants.
Amin Nasser and other top Saudi officials have simultaneously called for further investment in fossil fuels, a situation he reiterated on Sunday, saying Chinese President Xi Jinping was in agreement.
“We agree with Xi Jinping’s view that conventional energy sources and alternatives will have to work in parallel for decades to come,” Nasser said.
