Sinopec and Saudi Aramco invest over 70 billion yuan to build petrochemical complex in Fujian, China

Sinopec and Saudi Aramco have begun construction of a large refining and petrochemical complex in Fujian Province, which is expected to cost 71.1 billion yuan (9.82 billion U.S. dollars). This is the second large joint venture established by Saudi Aramco and Chinese state-owned oil companies in the refining and petrochemical fields, strengthening the cooperation between the two and reflecting the country's increasing investment in the petrochemical industry, which has expanded rapidly in recent years.

The complex, located in the Gulei Industrial Park in Zhangzhou City, will build a 16 million tonnes per year refinery that can process 320,000 barrels of crude oil per day, a 1.5 million tonnes per year ethylene plant, a 2 million tonnes per year paraxylene production unit and a 300,000 tonnes capacity crude oil terminal. Sinopec announced that the Fujian Provincial Government holds a 50% stake in the joint venture, while Sinopec and Saudi Aramco each hold a 25% stake.

For Saudi Aramco, the project is a key move to expand its downstream business outside Saudi Arabia. The company aims to increase crude oil supplies to China, with the goal of providing up to 1 million barrels per day for petrochemical projects. Mohammed Y. Al Qahtani, president of Saudi Aramco's downstream business, pointed out that the cooperation is part of the company's strategy to strengthen its influence in the Chinese petrochemical market.

The project is expected to be operational in 2030 and will produce 5 million tons of petrochemical raw materials per year after completion. Sinopec and Saudi Aramco signed a preliminary agreement for the project two years ago, and the new plant will be an expansion of Sinopec's previous ethylene complex in Gure.

Sinopec has been expanding petrochemical facilities across China. Last week, the company launched a 1.2 million ton per year ethylene complex in Tianjin and is building another plant of similar size in Zhenhai. The moves are part of China's broader efforts to achieve self-sufficiency in petrochemical products.

In the same industrial park, Saudi Basic Industries Corporation (SABIC) plans to invest $6.4 billion to build a new petrochemical complex in cooperation with a local government-backed company. The projects reflect China's growing push for self-reliance in petrochemical production, with both state-owned and private companies investing heavily.