State-owned giant oil/gas firm Saudi Aramco and petrochemicals firm Saudi Basic Industries (Sabic) have decided to re-evaluate their US$20 billion crude-oil-to-chemicals project and are now looking at integrating existing facilities instead.
In 2017, Aramco and Sabic had signed a preliminary deal to build a US$20 billion complex to convert crude oil to chemicals in Saudi Arabia.
However, a recent statement issued by Sabic say the two companies were now considering the integration of Aramco’s existing refineries in Yanbu with a mixed feed steam cracker and downstream olefin derivative units.
“Sabic and Saudi Aramco remain committed to continue advancing crude to chemicals technologies through existing development programs with the goal to increase cost efficiency, competitiveness and value creation opportunities for petrochemicals,” the statement said.
The decision comes against the back of the pandemic that has hit demand, with crude prices dropping. This has had oil companies globally re-assessing their energy projects to conserve cash.
Both companies were to build the complex that was expected to process 400,000 barrels per day of crude oil as well as be equipped to produce approximately 9 million tonnes/year of chemicals and base oils.
The facility, which was scheduled to be commissioned in 2025, was expected to be the largest crude oil-to-chemicals complex in the world.
At that time, Aramco had expected the complex to expand its downstream portfolio, secure new commercial opportunities and reduce focus on the transportation sector.