KUALA LUMPUR: Saudi Arabian oil giant Aramco is buying an equity stake in Malaysian firm Petronas’ major refining and petrochemicals project in the southeast Asian country, investing a total of $7 billion, the companies confirmed today (Tuesday).
In a joint statement, the firms said Aramco will take a 50 percent stake in select ventures and assets in the Refinery and Petrochemical Integrated Development (RAPID) project developed by Malaysian state-controlled Petroliam Nasional Berhad, known as Petronas.
The deal signing was formally witnessed by Malaysian Prime Minister Najib Razak and Saudi King Salman, currently on a state visit to Malaysia.
Petronas’ Chief Executive Officer Wan Zulkiflee Wan Ariffin told reporters Aramco will take a 50 percent stake in RAPID’s refinery and cracker project.
Aramco will supply up to 70 percent of the crude feedstock requirement of the refinery, with natural gas, power and other utilities to be supplied by Petronas.
RAPID will contain a 300,000 barrel-per-day oil refinery and a petrochemical complex with a production capacity of 7.7 million metric tonnes. It is expected to go online in the first quarter of 2019.
The facility is planned as part of the Pengerang Integrated Complex (PIC) in the southern Malaysian state of Johor that will include RAPID and oil storage facilities.
Petronas said almost 60 percent of the PIC development is complete, and that it is on track for refinery start-up in 2019.
Saudi Energy Minister Khalid al-Falih echoed Nasser’s comments, saying Saudi Arabia would use the Malaysian investment as a platform other investments in Southeast Asia.
