Saudi Aramco eyes 10% stake in China’s Hengli Petrochemical

Saudi Aramco, the global giant in integrated energy and chemicals based in Saudi Arabia, has initiated talks to purchase a 10% stake in Chinese petrochemical firm Hengli Petrochemical Co. Ltd., a subsidiary of Hengli Group Co. Ltd. This move is part of a broader strategy to enhance Aramco’s downstream operations in significant, high-value markets.

The discussions, which are still in the preliminary stages pending due diligence and regulatory approvals, were formalised through a Memorandum of Understanding (MoU) signed by both companies. This agreement underlines Aramco’s ambitions to advance its liquids-to-chemicals program and secure enduring crude oil supply agreements with key partners.

Hengli Petrochemical operates a substantial refinery with a capacity of 400,000 barrels per day and an integrated chemicals complex in Liaoning Province. Additionally, the company runs several other plants and production facilities across Jiangsu and Guangdong Provinces in China.

Mohammed Y. Al Qahtani, president of Aramco Downstream, commented on the development, stating, “This MoU supports our efforts to grow our global downstream footprint. We continue to explore new opportunities in important markets as we seek to progress in our liquids-to-chemicals strategy. We look forward to forging new partnerships and are excited by the prospect of expanding our presence in the important Chinese market.”

This strategic investment is seen as a significant step for Aramco to strengthen its position in the global energy market, particularly in China, where demand for petrochemical products continues to grow.