Saudi Arabian energy giant Aramco, the largest oil producer in the world, announced a multibillion dollar investment in a Chinese oil firm Monday morning, continuing the oil giant’s expansion into the region.
The $3.6 billion deal would grant Aramco a 10% stake in Rongsheng Petrochemical, and send roughly 480,000 barrels of Saudi oil to a Rongsheng refinery in China per day, via Rongsheng affiliate Zhejiang Petroleum and Chemical Co., Aramco announced in a press release. The oil giant also announced plans Sunday to begin construction of an integrated refinery and petrochemical plant in the Liaoning Province of northeast China, at an estimated cost of $12.2 billion, according to Reuters.
“This announcement demonstrates Aramco’s long-term commitment to China and belief in the fundamentals of the Chinese petrochemicals sector. It is an important acquisition for Aramco in a key market, supporting our growth ambitions and advancing our liquids to chemicals strategy,” Mohammed Y. Al Qahtani, a high-ranking Aramco official, said in a Monday press release, referring to the Rongsheng deal. “It also promises to secure a reliable supply of essential crude to one of China’s most important refiners.”
The moves are the latest in a series of Aramco investments in China, Reuters reported. In late 2022, the company agreed to consider a crude supply deal with state-owned Shandong Energy and on Sunday announced an agreement with the nation’s Guangdong province to explore cooperation in energy, finance and other sectors.
“This strategic co-operation will take our long-term friendship and mutual trust to a new level, and paves the way for a bright future for the high-quality development of the world’s petrochemicals industry,” Chairman Li Shuirong of Rongsheng said in the same Monday press release. “I believe that Aramco’s involvement will greatly help Rongsheng implement its petrochemical growth strategy.”
Saudi Arabia was China’s largest supplier of oil in 2022, but a recent surge of Russian oil led the Middle Eastern kingdom to be unseated as China’s top oil supplier in February, according to Bloomberg. China and India have both seen their imports of Russian oil skyrocket, as the country seeks to offload oil at a discounted rate to attract buyers amid Western sanctions.
Aramco did not immediately respond to a Daily Caller News Foundation request for comment.
Content created by The Daily Caller News Foundation is available without charge to any eligible news publisher that can provide a large audience. For licensing opportunities of our original content, please contact firstname.lastname@example.org