Saudi Aramco and SABIC to develop innovative crude-oil-to-chemicals complex; 400K bpd; reducing focus on transportation
Saudi Aramco and SABIC have signed a memorandum of understanding (MoU) to develop a fully integrated crude-oil-to-chemicals (COTC) complex in the Kingdom of Saudi Arabia, which governs the execution of the Front End Engineering Design (FEED) before a final investment decision is made. The COTC complex is expected to process 400,000 barrels per day of crude oil, which will produce approximately 9 million tons of chemicals and base oils annually and is expected to start operations in 2025.
Today is a historic day, marking the complementary nature of the relationship between SABIC and Saudi Aramco because it is the first time the two largest economic entities in Saudi Arabia jointly enter into a strategic partnership to achieve a pioneering and innovative new technology. Once completed, this project will not only be the largest crude oil to chemicals complex in the world, it will also set a new competitive threshold thanks to the project’s mass scale and the benefits derived from our joint collaboration. The project will, therefore, help achieve the respective growth ambitions of Sabic and Saudi Aramco and further establishes the Kingdom as one of the pioneers in the petrochemicals industry.—SABIC Vice Chairman and CEO Yousef Abdullah Al-Benyan
This project converges the commercial and strategic interests of both Saudi Aramco and SABIC, while reinforcing Saudi Aramco’s efforts to optimize the investment of our petroleum resources. COTC will also help expand our downstream portfolio, reducing our focus on the transportation sector and securing new and promising commercial opportunities.—Saudi Aramco President and CEO Amin H. Nasser
The COTC complex will be constructed based on an innovative configuration that achieves crude oil to chemicals conversion that is unprecedented in the industry, the partners said.
This MoU follows the Heads of Agreement (HoA) signed in June 2016 between the two companies, which governed the feasibility study for the development of a fully integrated petrochemicals complex in the Kingdom. A Saudi team developed innovative COTC configurations derived from best-in-class refining and chemical technologies.
The complex is expected to create an estimated 30,000 direct and indirect jobs, further stimulating the Kingdom’s economic diversification. By 2030 the COTC complex is expected to have 1.5% impact on the Kingdom’s Gross Domestic Product (GDP), with investments being shared equally by both companies.