Published: Thu, April 12, 2018
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Saudi Aramco to jointly develop an integrated refinery

Saudi Aramco to jointly develop an integrated refinery

India is set to grant Saudi Aramco a 50 per cent stake in a planned 1.2 million-barrel-per-day (bpd) refinery on its west coast, said an industry source with knowledge of the deal, a move that would give the kingdom a new outlet for its oil.

"This project will enable us to strengthen our ties with Saudi Aramco, with whom we successfully operate our biggest and most efficient refinery in the world", Total Chairman and CEO Patrick Pouyanné said in a statement.

Days earlier, state oil giant Aramco sealed refining and petrochemicals deals worth about $20 billion in France and the United States. Saudi Arabia was the biggest oil supplier to India till 2016-17, but slipped behind Iraq last fiscal.

The refinery will be capable of processing 1.2 mn barrels of crude oil per day and will produce ~18 MT of petrochemical products per year. When asked what took Saudi Arabia so long to enter the business here, he said, "Saudi Aramco has been interested in India for decades".

The kingdom this year introduced a value-added tax for the first time in its history, along with new fees on its sizeable expatriate workforce, and it is opening up the ultraconservative country to tourism.

With Saudi Aramco as the strategic partner in the project, the partnership will bring together crude supply, resources, technologies, experience and expertise of these multiple oil companies with an established commercial presence around the world.

"We are a very price-sensitive consumer, " Pradhan said on Tuesday.

Saudi Basic, the Middle East's dominant chemical maker, said on Saturday that it wants to build a Houston headquarters for its Western Hemisphere operations as the company capitalizes on the surge in cheap natural gas supplies from North American shale fields.

Saudi Arabia is one of the world's top three oil producers with Russian Federation and the United States, while Aramco is the biggest company putting oil on the world market now awash with product.

The coalition has launched thousands of air strikes which have hit schools, markets and hospitals, killing hundreds of people - though it says it does not target civilians.

Alongside the deal with Total, two others were signed separately between Aramco and French environmental and waste management groups Veolia and Suez, and Saudi Arabia's Dussur on industrial wastewater treatment.

Chinese customs data showed imports from Saudi Arabia rose only 2.3 percent on 2017 from the previous year, below the overall increase of 10.2 percent.

Nasser said he was not anxious by rising supplies from regional rivals to India.

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