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Mon 18 Feb 2008 04:37 PM

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Saudi Aramco refinery ventures on track

State oil company says US's Conocophilips and France's Total progressing well'.

State oil company Saudi Aramco said on Monday its plans to build two refineries with US oil major ConocoPhillips and French peer Total were "progressing well", despite some industry concerns.

Higher labour and raw material costs have caused delays and cancellations across the world's oil and gas industry, and weakening refining margins have made crude processing projects especially vulnerable.

Some in the industry had begun to speculate that the two 400,000 barrel-a-day refineries in Jubail and Yanbu could be stalled, scaled back or even cancelled.

Saudi Aramco executive Khalid al-Buainain told a conference in London that although construction costs had risen for the refineries, it remained optimistic on the economics of the projects.

"Like everyone else, we have seen an escalation of costs, but it has not deterred us," Al-Buainain said. (Reuters)

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