MOSCOW (MRC) -- Saudi Aramco’s deepening network of ties with major Asian crude buyers gained fresh impetus in late February, as per Yourpetrochemicalnews.
At home, efforts to enlist the company’s key existing foreign partners in delivering the kingdom’s Vision 2030 economic blueprint bore fruit in a commitment by a long-standing Japanese investor to establish a steel mill at Ras al-Khair. Aramco is leading the development of a flagship maritime services complex at the port in the Eastern Province, north of Jubail.
Meanwhile, ministers from Riyadh and New Delhi confirmed that final details were being ironed out for the Saudi company’s long-mooted entry into the refining sector of India – the world’s third largest and fastest-growing oil consumer.
On February 28, Aramco announced signature of a memorandum of understanding (MoU) with Japan’s Nippon Steel & Sumitomo Metal and parent company Sumitomo Corp. to conduct a feasibility study on a proposed integrated steel mill producing steel plates – which would be established in Ras al-Khair.
No detail was provided on the envisaged capacity, cost or timeframe of the project. However, the announcement noted the potential uses of steel plates – namely the manufacture of pipes, pressure vessels, marine vessels and offshore platforms – making clear the linkage with the wider Ras al-Khair maritime complex development, where operations are scheduled to start in 2021.
The estimated USD5.2 billion scheme is being developed by Aramco in joint venture (JV) with local shipping affiliate Bahri, UAE-based fabricator Lamprell and South Korean shipbuilding giant Hyundai Heavy Industries – and will encompass ship and rig building and repair services.
Several other foreign companies have also committed to establishing ancillary projects. Sumitomo Corp. is a long-established 50:50 Aramco partner in the 13-year-old Rabigh Refining & Petrochemical Co. (PetroRabigh) JV – the project company for the Saudi firm’s maiden integrated refining and petrochemicals complex, at Rabigh on the Red Sea coast.
Other international investments in the wider Ras al-Khair development have likewise been linked to partnership elsewhere in Aramco’s far-reaching operations.
US contracting stalwart McDermott signed an MoU in March 2017 to establish a manufacturing facility at the nascent offshore services hub. This included commitments whose failure to meet which would have consequences for McDermott’s lucrative position as a signatory of one of Aramco’s long-term agreements (LTAs). These grant qualification for tens of billions of dollars-worth of offshore contracting.
Meanwhile, Lamprell’s commitment to the Ras al-Khair complex was rewarded with negotiations, still ongoing, on joining the exclusive LTA pool.
In mid-2016, US-based GE Oil & Gas – which last year merged with compatriot BakerHughes, a major supplier of oilfield services to Aramco – and Italy’s Cividale signed an agreement to establish a 50,000-75,000-tpy forgings and castings manufacturing facility at the east coast site.
mrcplast.com