The Saudi Arabian Oil Company (Saudi Aramco) and Petroliam Nasional Berhad (PETRONAS) today signed a Share Purchase Agreement (SPA), allowing Saudi Aramco’s equity participation in PETRONAS’ Refinery & Petrochemical Integrated Development (RAPID) project in the southern Malaysian state of Johor.
The signing ceremony was held in conjunction with King Salman’s state visit to Malaysia. Also present at the ceremony was His Excellency Khalid A. Falih, Saudi Arabia’s Minister of Energy, Industry & Mineral Resources and Chairman of the Board of Directors of Saudi Aramco.
Upon the completion of the transaction, subject to regulatory approvals and the completion of other associated agreements, both partners will hold equal ownership in selected ventures and assets of the RAPID project within the Pengerang Integrated Complex (PIC).
The RAPID project is part of the PIC development undertaken by PETRONAS and is positioned to be a regional downstream oil and gas industrial hub, paving a new frontier of technology and economic development in the Southeast Asia region.
Under the partnership, Saudi Aramco will meet most of the crude feedstock requirements of the refinery, with natural gas, power and other utilities supplied by PETRONAS.
PETRONAS’ President & Group CEO Datuk Wan Zulkiflee Wan Ariffin said, “The PIC is one of the largest industrial developments in the region as well as PETRONAS’ largest downstream investment on a single site to date.”
With capacity to refine 300,000 barrels of crude per day, RAPID’s refinery will produce a host of refined petroleum products, including gasoline and diesel which meets Euro 5 fuel specifications; as well as feedstock for its integrated petrochemical complex producing 3.5 million tons per annum of products.
Situated 400 kilometers south of Malaysia’s capital Kuala Lumpur, the PIC development is almost 60 percent complete and is on track for refinery start-up in 2019.
Apart from RAPID, which comprises the refinery, cracker and the downstream petrochemical complex, the PIC, located on a 6,242-acre site, also includes the development of associated facilities such as a co-generation plant, an LNG re-gasification terminal, a raw water supply project, a deep water terminal, as well as centralized and shared utility facilities.
The PIC forms part of Malaysia’s ambitious 22,000-acre Pengerang Integrated Petroleum Complex (PIPC) under the Government’s Economic Transformation Program to establish new engines of growth and push the nation into a new frontier of technology and economic development in the oil and gas downstream sector.