April 30, 2025 – Sinopec, Fujian Refining and Chemical, and Saudi Aramco’s Subsidiary Forge a Massive Joint Venture for Major Chemical Project
In a significant development announced on the evening of April 28, Sinopec (00386) has officially initiated a high – profile collaboration with Fujian Refining and Chemical and AAS, a subsidiary of Saudi Aramco. The three parties will jointly establish a joint venture with a staggering registered capital of 28.8 billion yuan, focusing on the second – phase integrated project in Gulei, Fujian, marking the beginning of an in – depth partnership in the chemical industry.
The cooperation framework outlined in the published “Joint Venture Agreement” is crystal clear. Sinopec will hold a 25% stake, Fujian Refining and Chemical will own 50%, and AAS, the Saudi Aramco subsidiary, will also possess a 25% share. All three parties will contribute capital in cash, with Sinopec’s contribution amounting to 7.2 billion yuan. The agreement meticulously details aspects such as equity restrictions and option arrangements, ensuring the stability of the company while also leaving room for flexible responses. Notably, since the applicable ratio of this transaction exceeds 5% but is below 25%, it constitutes a disclosable transaction, fully compliant with the listing rules of the Hong Kong Stock Exchange.
As learned from the Color Masterbatch Industry Network, the project plan of the joint venture is truly ambitious. In the refining segment, a series of advanced facilities, including a 16 – million – ton – per – year atmospheric and vacuum distillation unit, will be newly constructed. In the chemical segment, numerous production lines, such as a 1.5 – million – ton – per – year steam cracking unit, will be set up. Once the project is completed, it will be able to produce 2.88 million tons of aviation kerosene and other oil products, 12.7 million tons of polyolefins and other chemical products annually. Additionally, it will stably supply 5 million tons of raw materials to the Gulei Petrochemical Base in Fujian, significantly enhancing the industrial chain and promoting the coordinated development of upstream and downstream sectors. This cooperation not only showcases the international cooperation capabilities of Sinopec and Fujian Refining and Chemical but also demonstrates Saudi Aramco’s strong commitment to the Chinese market. As the project progresses, it is expected to inject powerful momentum into Sinopec’s competition in the international chemical market.