Saudi Aramco will invest more than $100 billion in petrochemicals over the next decade in an effort to make its downstream business as prominent as its upstream operations, the state-owned company’s president and CEO, Amin H. Nasser said Tuesday.
Nasser's remarks came during a keynote speech delivered at the 13th annual Gulf Petrochemicals and Chemicals Association (GPCA) Forum in Dubai, United Arab Emirates, according to a statement from the company.
The three-day downstream-focused event started on Monday, and hosts more than 2,000 delegates from almost 600 companies in 50 countries.
Nasser told delegates attending the forum that a key Saudi Aramco objective was to bring its downstream business to the same prominence as its upstream, as the company underwent substantial expansions in refining, marketing and lubes.
Nasser highlighted chemicals as the most promising element of the company's downstream strategy and added that chemicals would represent about one-third of world oil demand growth between now and 2030, and nearly half by 2050.
Petrochemicals are expected to add nearly seven million barrels per day (bpd) of oil demand by 2050, reaching a total of some 20 million bpd, the statement read.
'Saudi Aramco will make the most of those prospects with chemicals investments of more than $100 billion over the next 10 years—not including a prospective acquisition,' Nasser added.
'We are expanding this business both in Saudi Arabia and in fast-growing overseas markets like China and India, with the aim of converting two million barrels per day of crude oil into petrochemicals—and we may eventually move our target higher to three million barrels.
'Our ultimate target of 8-10 million barrels per day of integrated refining and marketing capacity will create a better balance between our upstream and downstream segments,' he said.
Nasser added that Saudi Aramco's downstream business ventures would provide a reliable destination for the company's future oil production, and diversify both their business portfolio and the Saudi economy.
Saudi Aramco's downstream strategy seeks to enhance its resource base by targeting increased horizontal and vertical integration across the hydrocarbon value chain, according to the statement.
'With a diversified, integrated, and robust business portfolio, our supply, trading, and marketing model will mitigate oil price volatility, generate additional revenues, and expand opportunities for conversion industries, local manufacturers, and service providers —all of which drive job growth and value creation,' the head of the company said.
Saudi Aramco is in negotiations for a major share in Riyadh-based diversified chemicals leader SABIC, with the aim of creating one of the world's strongest integrated energy and chemicals companies.
'The acquisition would leverage Saudi Aramco's innovative developments in crude oil to chemicals technology, or C2C, a process that eliminates the refinery stage to transform crude oil directly into valuable petrochemicals,' the statement said.
Saudi Aramco is a fully integrated, global petroleum and chemicals enterprise, and a major producer of crude oil and condensate.
By Hale Turkes
Anadolu Agency
energy@aa.com.tr