Market and product
Aramco, Total Discuss Adding Petrochemical Plant at Jubail
June 8 (Bloomberg) -- Saudi Aramco, the world’s largest state-owned oil company, and Total SA are discussing building a petrochemicals plant alongside a joint refinery project that they are developing at Jubail.
The partners began talks more than a year ago about building a cracker that could use byproducts from the joint refinery, Michel Govaerts, Total’s general manager for business development in the Middle East and Asia, said today.
The 400,000 barrel-a-day refinery in Jubail on Saudi Arabia’s Persian Gulf coast will cost more than $12 billion, Salem Shaheen, chief executive officer of Saudi Aramco Total Refining and Petrochemical Co., said in March.
The new cracker would be in addition to aromatics and olefins units planned to be incorporated in the Jubail refinery, Govaerts said at a conference in Abu Dhabi. Financing for the project is “being finalized,” he said.
The Jubail refinery will be the main energy project financing deal this year, HSBC Holdings Plc’s Darren Davis said at the conference. Financing for the project will close soon and Aramco is in the market for lending for another refinery planned at Yanbu, said Davis, managing director for HSBC’s Middle East resources and energy group.
Aramco and state-run Abu Dhabi Oil Refinery Co., known as Takreer, are among Middle Eastern crude producers boosting refining capacity to meet demand at home. Saudi Arabia, holder of the world’s largest oil reserves and the biggest producer in the Organization of Petroleum Exporting Countries, imports refined products such as gasoline because it lacks capacity to meet domestic demand.
Expanding Production
Persian Gulf oil producers such as the United Arab Emirates, of which Abu Dhabi is the capital, and Saudi Arabia are expanding into petrochemicals production to benefit further from their oil resources than just selling crude.
The Saudi Aramco-Total project, known as Satorp, is expected to start operation in mid-2013, Shaheen said.
Total also sees opportunities to expand petrochemical operations in Qatar, where gas is available to supply plants, Govaerts said. The company could expand capacity at an ethane cracker it runs in the industrial city of Mesaieed, he said.
(Source: Bloomberg, by Anthony DiPaola, Editors: Randall Hackley, Raj Rajendran)
