Saudi Arabia’s state oil company, Saudi Aramco, has torn up a major contract to build a refinery and petrochemical complex in China as part of a joint venture, Bloomberg reports.
The cost of the project in the North-Eastern province of Liaoning was supposed to be 10 billion dollars, but the Saudi company considered the costs too high, and the market prospects of the plant — uncertain. China intends to further promote the project, not excluding that Saudi Aramco may change its mind.
The reason for reconsidering its investment plans for the company was the desire to maintain a dividend of $ 75 billion. Because of this, the management of Saudi Aramco is looking for any ways to reduce capital expenditures against the background of low oil prices and rising debt.
When the construction agreement was signed in February last year, it was seen as a landmark deal with a key partner, as the Kingdom wanted to increase market share and attract Chinese investment. Saudi Arabia wanted to supply up to 70 percent of the oil to the new facility with a capacity of 300,000 barrels per day.
Earlier it became known that the net profit of the Saudi company in the first half of the year fell by half compared to the same period in 2019 — from 46.9 billion dollars to 23.2 billion. Against this background, Saudi Aramco gave Apple the status of the most expensive company in the world.