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Saudi Aramco inks first oil contract with Chinese Huajin

February 15/2017

MOSCOW (MRC) -- State oil giant Saudi Aramco has signed a contract with Chinese oil refiner North Huajin Chemical Industries Group Corp to supply crude in 2017, two sources with knowledge of the matter said on Monday, reported Reuters.

The contract, the first between Aramco and Huajin, comes as Saudi Arabia attempts to regain its status as the top crude supplier to China, the world's second-largest oil consumer, this year after losing the top spot to Russia in 2016.

Saudi Aramco will supply Arab Extra Light crude to Huajin to enable the Chinese state-controlled refiner to produce more naphtha for its petrochemical production, one of the sources said.

Saudi Aramco did not respond to an e-mail seeking comment. Huajin, a unit of China's military group NORINCO, could not be immediately reached for comment.

Top global oil exporter Saudi Arabia has been exploring new ways to sell more crude to China by offering spot cargoes and providing better credit terms.

Saudi Aramco could also start supplying crude to the Huizhou refinery owned by China National Offshore Oil Corp (CNOOC) after an expansion that is expected to finish in the second quarter.

Huajin operates a crude oil refinery in Panjin in Liaoning province with a processing capacity of 6 MMtpy and a petrochemical plant in Panjin that produces 700,000 tpy of ethylene, according to an announcement from its listed unit North Huajin Chemical Industries Co Ltd.

The company also has fertilizer plants in the Inner Mongolia region and in the Xinjiang region.

As MRC informed earlier, in June 2016, Saudi Arabian Oil Co. and Saudi Basic Industries Corp. (Sabic) became one step closer to building their first plant to process crude directly into chemicals, cutting out a link in the production chain from hydrocarbons to the finished products that go into plastics and other consumer goods. The state-owned companies signed an agreement to study such a project to be located in Saudi Arabia, they said in a statement. A joint venture is possible if the companies decide to move ahead after the study is completed by early 2017, they said. Oil companies normally refine crude into transportation fuels including gasoline and diesel and leave byproducts such as naphtha to be processed separately into chemicals.

audi Aramco is an integrated oil and chemicals company, a global leader in hydrocarbon production, refining processes and distribution, as well as one of the largest global oil exporters. It manages proven reserves of crude oil and condensate estimated at 261.1bn barrels, and produces 9.54 million bbl daily. Headquartered in Dhahran, Saudi Arabia, the company employs over 61,000 staff in 77 countries.
Author:Margaret Volkova
Tags:PP, PE, neft i gazoviy kondensat, propylene, ethylene, petrochemistry, CNOOC, Sabic, Saudi Aramco, China, Saudi Arabia.
Category:General News
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