By Rob Corder
Joint ventures worth $5 billion signed by Aramco, ExxonMobil and Chinese state oil company Sinopec.
Two joint ventures between ExxonMobil, Saudi Aramco, Sinopec and Fujian Province have been approved by the Chinese government.
A ceremony was held yesterday in the Great Hall of the People in Beijing to mark the occasion.
The agreement will see the creation of two joint venture companies that will build and operate integrated oil refining, petrochemicals and fuel marketing projects with a combined value of $5 billion.
It is the first time that foreign companies have been allowed to invest in Chinese petrochemical projects - breaking a government monopoly on the sector. The approval of the joint venture could pave the way for another $5 billion petrochemical project backed by Saudi Arabian Basic Industries (SABIC) in China's Dalian province.
Two new companies have been incorporated under the terms of the joint venture agreements. Fujian Refining & Petrochemical Company Limited will be 50 percent owned by China's Fujian Petrochemical Company Limited, 25 percent by Saudi Aramco, and 25 percent by ExxonMobil.
The company will primarily be responsible for refining sour crude oil from Saudi Arabia.
Sinopec SenMei (Fujian) Petroleum Company Limited will manage and operate approximately 750 service stations and a network of terminals in Fujian Province.
It will be 55 percent owned by Sinopec, 22.5 percent by ExxonMobil, and 22.5 percent by Saudi Aramco Sino.
The refinery expansion part of the project is expected to be completed by the end of 2009.