MOU Saudi Aramco and Sabic to Jointly Develop Crude Oil to Chemicals Complex
The two leading companies in Saudi Arabia have entered into an agreement to create a Crude Oil to Chemicals Complex. The project is expected to commence operations in 2025 and produce approximately 9 million tonnes of chemicals and base oils annually.
Dhahran/Saudi Arabia – 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, the 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 the joint collaboration.
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 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 tonnes of chemicals and base oils annually and is expected to start operations in 2025.
This announcement marks a historic alliance between the two largest Saudi global entities, in addition to solidifying the Kingdom’s position as a global leader in chemicals by substantially increasing production and further maximizing value across the entire hydrocarbons chain through integration. The COTC complex will be constructed based on an innovative configuration that achieves crude oil to chemicals conversion that is unprecedented in the industry.
This MOU follows the Heads of Agreement 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.