For RMB 24.6 billion ($3.4 billion at the current exchange rate), Aramco acquired 10% of Rongsheng. The transaction shows that Aramco's downstream position in China is still expanding. In a long-term sales agreement, Aramco will provide 480,000 barrels per day of crude oil to Zhejiang Petroleum and Chemical Co., Ltd. (ZPC). Through its Dutch-based subsidiary, Aramco Overseas Company BV, one of the largest integrated energy and chemical companies in the world, Aramco completed a historic deal to buy a 10% stake in Rongsheng Petrochemical Co. Ltd. ("Rongsheng") for RMB 24.6 billion ($3.4 billion). The transaction comes after both companies signed finalized strategic agreements, which were publicly revealed on March 27, 2023. The supply of 480,000 barrels per day of Arabian oil to the biggest integrated refining and chemicals complex in China, which is controlled by Rongsheng affiliate Zhejiang Petroleum and Chemical Co. Ltd. (ZPC), shows how Aramco's downstream footprint in China is continuing to expand.
Aramco Downstream President Mohammed Y. Al Qahtani stated: "Our strategic cooperation with Rongsheng advances Aramco's liquids to chemicals strategy while expanding our presence in China and highlighting our relevance as a trustworthy crude oil provider. This significant acquisition strengthens Aramco's position in a crucial market and is a crucial component of our long-term growth strategy.
According to Rongsheng Chairman Li Shuirong, "the completion of this transaction marks the entry of Rongsheng and Aramco into a new era together and also signifies an important step forward in Rongsheng's internationalization strategy. In ZPC, which has the ability to process 800,000 barrels of crude oil per day and generate 4.2 million metric tons of ethylene annually, Rongsheng has a 51% equity stake.
