Page 9 - DMEA Week 17 2020

DMEA PETROCHEMICALS DMEA
Total spares $5bn Saudi petchem venture from spending cuts
SAUDI ARAMCO
Like many of its peers, the French major has announced deep cuts to spending.
FRANCE’S Total has said it intends to push ahead with its $5bn petrochemical joint project with Saudi Aramco in the Saudi city of Jubail, despite making big cuts to investment.
“The recently announced objective by Total to reduce its capital expenditure for 2020, includ- ing $500mn in the downstream sector, does not include this project,” Total said in a statement to Reuters on April 28.
The partners are focused on controlling costs and are carrying out engineering studies for the project, which will be built next to the Satorp refinery. The complex will comprise a mixed- feed cracker able to produce up to 1.5mn tonnes per year (tpy) of ethylene. Its launch is scheduled for 2024.
Total noted that the partners are making efforts to ensure that this schedule is met.
Like many of its peers, the French major has announced big cuts to spending and warned that some projects might be shelved, in light of the oil price collapse. In late March it reined in its capital expenditure plan for 2020 by over 20% to $15bn. It also said it would cut operating costs by $800mn compared with 2019, and suspend its $2bn buyback scheme.
Total and Aramco are also partnered at the 460,000 barrel per day (bpd) Jubail Satorp refin- ery, which began commercial operations in 2014.
InOctober2018,AramcoandTotalsigneda
joint development agreement (JDA) to proceed with the development of a world-scale petro- chemicals complex near Satorp, highlighting the closeness of their downstream ties.
When announcing plans for the so-called Amiral complex, the partners also stated their intention of attracting $4bn in investment for additional petrochemicals and speciality chemi- cal facilities in Jubail and elsewhere.
This will feed off the estimated $5bn main plant, which will comprise a 1.5mn tpy mixed- feed cracker and derivatives units, and be com- pleted in 2024.
In January, a memorandum of understand- ing (MoU) was signed Aramco, Total and South Korea’s Daelim to build an 80,000 tpy polyisobu- tylene (PIB) plant that will use feedstock from Amiral.
Meanwhile in June last year, the Saudi-French team signed an MoU with UK-based Ineos to build three new plants in Jubail in the kingdom’s Eastern Province.
This deal covered the construction of a 425,000 tpy acrylonitrile plant, a 400,000 tpy unit for linear alpha olefins (LAO) and a “world- scale” PolyAlphaOlefin (PAO) facility, with all scheduled to begin producing in 2025.
The new units will be part of the Jubail 2 com- plex and will be located alongside Satorp.
Aramco and Total own stakes of 62.5% and 37.5%respectivelyinbothSatorpandAmiral.™
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