Saudi Aramco and Sumitomo Chemical are planning to invest $7bn to expand the Rabigh petrochemical complex in Saudi Arabia.
The Rabigh II project will include a new aromatics complex and an expanded ethane cracker facility to process 30 million cubic feet of ethane and three million tonnes per annum of naphtha.
Rabigh II will use ethane and naphtha as feedstock to produce various petrochemical products including ethylene propylene rubber, thermoplastic polyolefin, methyl methacrylate monomer, polymethyl methacrylate, low density polyethylene/ ethylene vinyl acetate, para-xylene/benzene, cumene and phenol/acetone.
Rabigh II will use technologies from Sumitomo Chemical and other companies to maximise existing synergies, make use of Saudi labour and help develop Saudi Arabia's conversion industries, according to Saudi Aramco.
Saudi Aramco president and chief executive officer Khalid A Al-Falih said the partnership with Sumitomo Chemical continues to make further inroads in the company's downstream portfolio expansion and diversification strategy.
"Both sponsors are thankful to the Ministry of Petroleum and Mineral Resources for their continued support for Rabigh's expansion projects, and through which we endeavor to create further value for our stakeholder communities in the kingdom with new businesses, entrepreneurial and job opportunities," Al-Falih added.
Sumitomo has confirmed the feasibility and front-end engineering design work of the project, and has decided to finalise various project elements including contracts for engineering, procurement and construction and other projects contracts as well as project financing.
Subject to an independent evaluation of the project feasibility results and regulatory approval procedure, Rabigh Refining and Petrochemical, a joint stock company of Saudi Aramco and Sumitomo, will be approached to serve as the project company for Rabigh II.
The project is expected to begin operations in the first half of 2016.
Image: Saudi Aramco's headquarters complex in Dhahran, Saudi Arabia.