‘Aramco Partnership Would Help China Meet Its Energy Security’

‘Aramco Partnership Would Help China Meet Its Energy Security’

/ Oil & Gas / Friday, 24 June 2022 09:10

Aramco has offered to build a ‘one stop shop’ in the city of Shandong that could help the country’s long-term energy security, economic development and climate change mitigation goals.

Addressing the gathering at the 3rd Qingdao Multinationals Summit in China, Mohammed Y. Al Qahtani, the Aramco Senior Vice President Downstream, said China’s rising energy needs and the challenging environment underline the strategic case for a more resilient energy system.

“The impact of an Aramco “one-stop shop” on Shandong would be profound. And it would solidify Shandong’s crucial role in making some of China’s most important goals a reality,” said Al Qahtani

"Stronger ties with the world’s largest oil exporter would enhance China’s energy security, especially as we work on increasing our production capacity to 13 million barrels per day," he stated.

Praising China’s 14th Five Year Plan for prioritizing energy security and stability and its importance in economic development, Al Qahtani said, "We aspire to invest in China’s future economic growth by building a large, integrated downstream business across the country with our Chinese partners - Everything from reliable supplies of oil and natural gas liquids to refining, marketing, petrochemicals, and lubricants."

Highlighting Aramco’s lowest upstream carbon intensity footprints in the world, he said, “fueled by our well-known net-zero ambitions, we are committed to being one of China’s lowest carbon intensity suppliers of energy far into the future, leveraging ever more advanced technologies like carbon capture, utilization, and storage; hydrogen; and Direct Air Capture technology, while adopting the circular carbon economy framework.

By 2035 Aramco aims to reduce its Upstream carbon intensity, already one of the lowest in the industry, by 15% to 8.7kg of CO2 equivalent per barrel of oil equivalent (CO2e/boe), against a 2018 baseline of 10.2kg CO2e/boe.

Al Qahtani said with Aramco support, there’s an incredible opportunity to create a modern, efficient downstream sector in Shandong, with lower emissions, which could provide a wide range of products to the whole nation for decades to come.

Attended by representatives from 186 Fortune 500 and 290 industry leading companies along with senior government officials, the summit facilitated discussions between foreign companies and Shandong, which is home to 26% of China’s refining capacity and is a key destination for Aramco crude oil exports. Shandong sealed foreign investment deals worth $15.6 billion for 99 projects in various cities during the event.

In March, Aramco through its Saudi Aramco Asia Company Limited (“SAAC”) subsidiary signed a Memorandum of Understanding (MoU) with China Petroleum & Chemical Corporation (“Sinopec”) for potential downstream collaboration in China.

SAAC and Sinopec also aim to support Fujian Refining and Petrochemical Company, Ltd. (“FREP”) in conducting a feasibility study into the optimization and expansion of capacity.

This MoU provides a basis for continued downstream collaboration between Aramco and Sinopec, capitalizing on each company’s strengths and their long-term relationship through existing joint ventures, namely FREP and Sinopec Senmei (Fujian) Petroleum Company (SSPC) in China, and Yanbu Aramco Sinopec Refining Company in Saudi Arabia.

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