Aramco to help build India’s biggest refinery
London - Saudi oil giant Aramco has agreed to work with energy firms in India to build the country’s largest oil refinery.
Aramco announced the signing of a memorandum of understanding with Ratnagiri Refinery and Petrochemicals Ltd., a consortium of state-owned Indian oil companies, to develop and build an integrated refinery and petrochemicals complex at Ratnagiri, in the west coast state of Maharashtra.
The project, which is estimated to cost $44 billion, is the latest deal announced by Aramco. It recently signed a $5 billion deal with France’s Total to build a refinery at Jubail, Saudi Arabia, and a $10 billion agreement with US energy firms, including drilling services companies Baker Hughes and Halliburton.
Aramco has also pledged billions of dollars for deals in Malaysia and Indonesia in the past year.
“Investing in India is a key part of Saudi Aramco’s global downstream strategy and another milestone in our growing relationship with India,” Aramco President and CEO Amin Nasser said during the signing ceremony.
“The signing marks a significant development in India’s oil and gas sector, enabling a strategic joint venture and investment partnership that will serve India’s fast-growing demand for transportation fuels and chemical products,” Nasser said.
He added that Aramco participating in the project would allow it to go beyond its crude oil supplier role to a fully integrated position that may help in other areas of collaboration, such as refining, marketing and petrochemicals, for India’s energy demands.
Aramco said the new refinery would be capable of processing 1.2 million barrels of crude oil per day and produce a range of refined petroleum products, including gasoline and diesel, meeting BS-VI fuel efficiency norms.
The refinery is also to provide feedstock for the integrated petrochemical complex capable of producing approximately 18 million tonnes per year of petrochemicals.
In addition to the refinery, cracker and downstream petrochemical facilities, project plans include facilities such as a logistics, crude oil and product storage terminals, raw water supply, as well as centralised and shared utilities.
Saudi Arabia is one of the world’s top three oil producers, along with Russia and the United States, with Aramco as the centrepiece of its operations.
Saudi Aramco has crude oil reserves of 265 billion barrels, more than 15% of all global oil deposits. It produces more than 10 million barrels per day, three times as much as the world’s largest listed oil company, ExxonMobil, and its reserves are more than ten times larger.
Aramco, believed to be the world’s most valuable company, is planning an initial public offering for later this year or next. However, the Saudi government has yet to decide whether to list the company’s shares on the Saudi exchange alone or on a stock market abroad. New York, London and Hong Kong are favoured as potential sites for a possible dual listing.