Saudi Aramco To Sign Investment Agreements With PetroChina

Saudi Aramco To Sign Investment Agreements With PetroChina

Shandong Independent Refineries’ Margins From Reforming Units Hit A 3-month High

Khalid al-Falih, Energy Minister of Saudi Arabia, announced that Saudi Aramco would sign the final agreement with PetroChina on the investment in PetroChina Yunnan Petrochemical within the following 6 months. Saudi Aramco will have a big proportion of the shares of the refinery in Yunnan Province, after the sign of the agreement. The refinery’s oil processing capacity will reach 260,000 barrels/day.

PetroChina Yunnan Petrochemical has produced qualified products in August, and it will get crude oil from Saudi Arabia based on the coming agreement.

Saudi Aramco has built cooperation with major players in China’s oil refining industry. In May, Saudi Aramco signed an agreement with China North Industries Group Corporation. According to the agreement, a refining and chemical integration project will be built with the oil refining capacity of 15,000kt/a (300,000 barrels/day) and ethylene capacity of 1,000kt/a. 

The margins from catalytic reforming units at Shandong independent refineries began to increase at the end of June. According to SCI, the margins of catalytic reforming units at Shandong independent refineries was RMB 717.23/mt as of August 23, 2017, theoretically. The margins had reached a 3-month high. The average price of gasoline at Shandong independent refineries increased by RMB 640/mt from the end of July to August 16, while major feedstock prices were largely stable.

The market demand for gasoline is decreasing sharply, due to the end of students’ summer holiday. But the environmental protection inspections and production safety checks are weighing down the market supply of gasoline. Accordingly, the margins from catalytic reforming units at independent refineries will hover at high levels in the short run.