Saudi Aramco’s chemicals division, Saudi Basic Industries Corporation, is set to acquire up to a 50 percent stake in an advanced materials project owned by Chinese private petrochemical company Rongsheng Petrochemical in Zhoushan.
A partnership agreement has been signed between the two companies to jointly develop the Jintang New Materials Project located in eastern China’s Zhejiang province. Details regarding the investment share, transaction structure, and pricing will be finalized in the future.
Rongsheng announced in 2024 that the Jintang New Materials Project will involve a total investment of approximately ¥67.5 billion (around $10 billion). The initiative aims to boost production of specialized chemical materials, including fine chemicals, high-end resins, engineering plastics, biodegradable plastics, and specialty polyester, to meet the rising demand from key downstream sectors across China and Asia.
“This partnership marks a significant milestone and exemplifies successful cooperation between Rongsheng and Saudi Aramco,” stated the CEO of Rongsheng. “It reflects a strategic alliance where both industry leaders leverage their respective strengths and capabilities to collaborate on research, development, and operational activities within the advanced chemical materials sector.”
Furthermore, the companies intend to formalize their collaboration through additional agreements, such as licensing and technology service contracts, to facilitate comprehensive joint efforts on advanced technological applications, Rongsheng added.
In a separate announcement, Rongsheng revealed plans to invest ¥19.6 billion to establish new production lines at its existing oil refineries. These upgrades will optimize utilization of by-products, with an expected payback period of approximately 8.9 years after a two-year construction phase. The project is projected to generate annual net profits of roughly ¥1.4 billion ($206.6 million).
Last July, Saudi Aramco completed a strategic investment in Rongsheng valued at ¥24.6 billion, securing a 10 percent ownership stake—its second-largest shareholding in the company. The two firms also entered into multiple cooperation agreements, including a deal for crude oil procurement.
Rongsheng’s shares, traded on the Shenzhen Stock Exchange under the ticker [SHE: 002493], increased by 1.7 percent today to close at ¥11.33 ($1.67), while the Shenzhen Composite Index fell 5.4 percent.