OREANDA-NEWS Saudi Aramco has signed a final agreement to acquire from Sumitomo Chemical about a 22.5% stake in the petrochemical complex Rabigh Refining and Petrochemical Co. (Petro Rabigh) for $702 million, the parties said in a release.

Aramco and Sumitomo Chemical (headquartered in Tokyo) now dispose of 37.5% of the shares of Petro Rabigh. Upon completion of the transaction, Aramco will become the largest shareholder of the complex with a stake of approximately 60%, and the Japanese company will retain a 15% stake. It is noted that the companies will have to get regulatory approval.

The deal is part of a package of financial measures to improve Petro Rabigh's financial position. Thus, all proceeds received by Sumitomo Chemical from the sale will be invested in Petro Rabigh. Aramco will also provide additional funds to the trust company, as a result of which the total amount of additional investments in Petro Rabigh will amount to $1.4 billion. In addition, Aramco and Sumitomo Chemical have agreed to phase out equity loans of $750 million each.

Petro Rabigh's financial improvement plan also includes initiatives to modernize the refinery.

Petro Rabigh is an integrated oil refining and petrochemical complex located on the west coast of Saudi Arabia. It can process up to 400 thousand barrels of light oil per day and annually produce 115 million barrels of gasoline, naphtha, jet fuel, diesel fuel and fuel oil. The capacities of the petrochemical part of the complex allow the annual production of up to 2.8 million tons of polyethylene, monoethylene glycol, polypropylene, propylene oxide and other derivatives of petroleum, ethane and butane supplied by Saudi Aramco.