Saudi Arabia’s state oil company will sign an agreement this weekend with a British oilfield services firm to explore building chemical facilities in Texas, according to people familiar with the matter.
The agreement with TechnipFMC PIc involves a study for a potential chemical unit on the US Gulf Coast that would be able to produce materials used in gasoline and as industrial solvents, said the people, who asked not to be identified because the matter isn’t public. There will also be a study on a facility that can make ethylene, a key compound for making plastics. Saudi Aramco, through its Motiva Enterprises LLC subsidiary, owns North America’s largest refinery, in Port Arthur, Texas, Bloomberg reported.
Crown Prince Mohammed bin Salman, heir to the throne of the world’s largest oil exporter, is wrapping up a three-week tour of the US to promote his effort to open up the Saudi economy through his “Vision 2030” and has announced several development projects. While in New York in late March, he signed a memorandum of understanding with Softbank Group Corp. to build at $200 billion solar power development.
Investments in the US were announced as Aramco plans an initial public offering for as soon as the second half of this year. Proceeds from the share sale should be used to expand the company’s footprint in refining and petrochemicals, rather than in oil exploration and production, Aramco CEO Amin Nasser said in a March 26 Bloomberg television interview in New York.
Nasser also said Aramco is looking at a two- to three-fold expansion of its petrochemicals business from a “huge” global capacity, now that the Sadara joint venture with Dow Chemical is complete. Total SA, the French energy major, and Aramco are due to sign a non-binding agreement on April 10 to develop the petrochemical site at their refinery in Al-Jubail, a person familiar with the matter said April 6.
TechnipFMC declined comment. Heather O’Connor, a spokeswoman for Aramco, said by email that the company wasn’t planning any major announcements Saturday.