(Bloomberg) -- Saudi Arabia is seeking to invest more in projects around the world that turn oil into chemicals as it looks to lock in buyers for its crude.
The kingdom is already in talks to buy stakes in companies in China and the state-run Saudi Aramco has said it wants more deals this year and the next. Investing in plants that produce chemicals — which Riyadh sees as a driver of growth of future oil demand — as a way to ensure it has a ready market for its vast crude supply.
“We will be using oil to chemicals, domestically and abroad, and that’s why you see us, or you see Aramco investing a lot in China and we will be investing a lot everywhere else on planet Earth,” Saudi Arabia Energy Minister Prince Abdulaziz Bin Salman said at the Future Investment Initiative summit in Riyadh. “In this room in 2019, I did say we will monetize every molecule of energy this land has. Period.”
Aramco is in talks to buy a 10% stake in China’s Hengli Petrochemical Ltd. and is seeking similar deals with two other Chinese companies. It closed a separate $3.4 billion deal for a stake in Rongsheng Petrochemical Co. last year.
The Saudi company has said it aims to eventually turn about 4 million barrels a day of crude into chemicals, from about 2 million currently. It’s looking to upgrade existing facilities in Saudi Arabia to be able to process more oil into petrochemicals, Chief Executive Officer Amin Nasser said in August.
The push into China is also a reason Aramco and its unit Sabic have canceled plans to build a refinery and chemicals project in the kingdom and is reviewing three others.
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