French Total to enter Saudi downstream business
By Dr. Cyril Widdershoven – Berry Commodities – Global Head of Strategy & Risk
Saudi Aramco is currently mainly in the news with regards to multibillion investment schemes in Asian markets, showing an increased appetite to lock in demand for Saudi crude in China, Pakistan and India. But make no mistake, local ventures could be making headlines again very soon.
In the last couple of days, news has popped up that Aramco and French oil major Total, through its Satorp joint-venture, Sumitomo Mitsui Banking Corporation and Riyad Bank to help raise funds to develop a petrochemical facility in the kingdom. The parties are asked to assist with the financing of the $5 billion Admiral project, which is going be in Jubail in the Eastern Province. Satorp already operates a refinery and will convert fossil fuels into building blocks for plastics. This new project is a logical step forward in the Saudi plan to diversify its oil-dependent economy and turn it into a more sustainable economy. Part of this move is to expand the petrochemicals sector. The Admiral project is expected to have a total production capacity of 2.7 million tons of chemicals per year, and is expected to come onstream by late 2023 or early 2024.