Aramco Signs Deal for Indian Petchems Complex

Just a day after signing a major deal with Total for a giant petrochemical complex in Saudi Arabia, Saudi Aramco has inked another Memorandum of Understanding (MoU) for an integrated refinery and petrochemical complex, this time on the west coast of India.

The agreement is with Ratnagiri Refinery and Petrochemicals Ltd. (RRPCL), a consortium of companies that include Indian Oil, Bharat Petroleum and Hindustan Petroleum. The project to develop and build the complex at Ratnagiri, in the state of Maharashtra, is estimated to cost $44 billion. Saudi Aramco said it may also seek to include a strategic partner to co-invest in the mega-refinery.

A pre-feasibility study for the refinery has been completed, and the parties are now finalizing the project’s overall configuration. Following the signing of the MoU, the companies will now discuss the formation of a joint venture that would provide for joint ownership, control and management of the project.

The proposed refinery will be capable of processing 1.2 million barrels per day of crude oil, producing a range of refined petroleum products as well as feedstock for the petrochemicals complex, which will have a capacity of around 18 million t/y. A timescale for the project was not disclosed.

In addition to the refinery, cracker and downstream petrochemical facilities, the project will include associated facilities such as logistics, crude oil and product storage terminals, raw water supply, and centralized and shared utilities.

“Investing in India is a key part of Saudi Aramco’s global downstream strategy and another milestone in our growing relationship with India,” said Aramco’s president and CEO, Amin Nasser. “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.”

Earlier this month, Aramco formed two joint ventures with Malaysia’s national oil company Petronas for the Refinery and Petrochemical Integrated Development (RAPID) project in Johor.  Under the agreements, Aramco will supply 50% of the refinery’s crude feedstock requirements and will share output from the jv companies on an equal basis.