April 10, 2018
PARIS (Reuters) – Saudi state-oil giant Aramco on Tuesday said it had signed agreements worth over $12 billion with French companies including Total (TOTF.PA), Technip (FTI.N) and Suez (SEVI.PA) during a visit by Saudi Crown Prince Mohammed bin Salman to France.
The young prince who is behind reforms to wean Saudi Arabia off its dependence on oil exports and open up Saudi society was concluding a three-day trip at a time when differences over Iran are testing relations between the two nations.
Speaking at a Franco-Saudi economic forum in Paris, Saudi Aramco CEO Amin Nasser said there was scope for further deals in the future.
“There are more opportunities for collaboration and partnerships, not only in the oil and gas sector but also in infrastructure, manufacturing and services industries which are critical to manage and operate an enterprise like Saudi Aramco,” Nasser said.
Alongside the deal with Total, two others were signed separately between Aramco and French environmental and waste management groups Veolia (VIE.PA) and Suez (SEVI.PA), and Saudi Arabia’s Dussur on industrial wastewater treatment.
“Saudi Aramco has a massive and highly ambitious investment program over the next decade, which is part of our portfolio expansion aspiration,” Nasser said.
The deal with Total (TOTF.PA) involves the construction of a petrochemical complex at their Jubail Satorp refinery, a joint venture in which Saudi Aramco holds a 62.5 percent stake, while Total holds the other 37.5 percent.
Total and Saudi Armaco said they would invest around $5 billion, while third-party investors will invest another $4 billion on petrochemical and specialty chemical plants on the site. The project will create some 8,000 jobs.
Total said that the petrochemical complex will comprise a mixed-feed steam cracker with a capacity of 1.5 million tons per year of ethylene and related high-added-value petrochemical units, the statement said.
Front-end engineering and design for the complex will start in the third quarter of 2018.
“This project illustrates our strategy of maximizing the integration of our large refining and petrochemical platforms and of expanding our petrochemical operations from low-cost feedstock, to take advantage of the fast growing Asian polymer market,” said Total’s chief executive Patrick Pouyanne.
Reporting by John Irish, Bate Felix and Rania El Gamal in; Writing by Bate Felix; Editing by Richard Lough and Alexandra Hudson