Aramco eyes 10% stake in Shenghong Petrochemical
Saudi Arabia’s Aramco, a global leader in integrated energy and chemicals, is in discussions to acquire a 10% equity interest in Jiangsu Shenghong Petrochemical Industry Group Co., Ltd. (Shenghong Petrochemical), following a cooperation framework agreement with Jiangsu Eastern Shenghong Co., Ltd. (Eastern Shenghong). The potential acquisition is contingent upon due diligence and regulatory approvals.
Shenghong Petrochemical, a subsidiary of Eastern Shenghong, operates a 320 million barrel per day (MBD) integrated refinery and petrochemicals complex, a methanol-to-olefins and derivatives complex, and a purified terephthalic acid production facility. These are situated in the Xuwei Petrochemical Industrial Park, in Jiangsu Province, China.
The agreement outlines Aramco’s intention to supply Shenghong Petrochemical with crude oil and possibly other feedstocks. Both companies are also exploring cooperation on a significant expansion project, pending further discussions and the finalisation of agreements.
Mohammed Y. Al Qahtani, downstream president at Aramco, expressed the company’s eagerness to collaborate with Eastern Shenghong. He highlighted the partnership’s role in supporting China’s long-term growth, development, and energy security. The move aligns with Aramco’s downstream strategy to increase the conversion of Arabian crude oil to chemicals and expand its footprint in the Chinese market.
Eastern Shenghong, a vertically integrated energy and chemicals enterprise listed on the Shenzhen Stock Exchange, utilises advanced technologies in its new energy and materials businesses.