Monday, 27 February 2017

(NST) Saudi Aramco to invest US$7 billion in Rapid Pengerang project

PUTRAJAYA: Saudi Arabian Oil Co (Saudi Aramco) will invest US$7 billion (RM31.08 billion) in the refinery and petrochemical integrated development project (Rapid) in Johor, Prime Minister Datuk Seri Najib Razak announced today. 

He said this will make Saudi Arabia’s national petroleum and natural gas company the single largest investor in the country to date. 

Najib confirmed that a deal had been reached between Saudi Aramco and Petroliam Nasional Bhd (Petronas) earlier today to build and manage the Rapid oil refinery complex. 

“The discussions and negotiations (on Rapid) have concluded and been finalised… Their (Saudi Aramco) investment probably makes them the single largest investor (in Malaysia).” 

“The (US$7 billion) investment is huge and significant,” Najib told reporters following talks with Saudi ruler King Salman Abdulaziz Al-Saud at Seri Perdana here. 

Najib said Petronas and Saudi Aramco tomorrow will ink a memorandum of understanding (MOU) to collaborate in the project, adding that the full details of the joint-venture will be revealed during the signing of the MOU. 

He also said King Salman, who is on a four-day state visit to Malayia, was “satisfied” with the outcome of the negotiations. 

It was reported that the two companies will set up a joint-venture company in the first quarter of this year to run the project, with the refinery due to start operating in early 2019. 

The Rapid complex, located in Pengerang, Johor, comprises a refinery, petrochemical and co-generation plant, an LNG regasification terminal, an air-separation unit, a raw-water supply project, a liquid bulk terminal, as well as central and shared utilities and other related facilities. 

Najib also reminded detractors that foreign investments were not made at the expense of the country’s sovereignty. 

“When we went to China, we were accused of selling out our sovereignty. I wonder what they will say now that Saudi Arabia is investing in Malaysia. Are they going to say that we are selling our sovereignty to Saudi Arabia? 

“Actually, it’s not a question of sovereignty. It’s a question of investment. It will bring in foreign capital and strengthen the ringgit in the medium term. This also means more jobs. It also shows a strong vote of confidence in our economy.” 

The Rapid project has reached its halfway point and is on track towards achieving the overall startup in the first quarter of 2019. 

The US$21 billion (RM87.4 billion) complex will have a combined capacity to produce 7.7 million tonnes/year of various grades of products, including differentiated and specialty chemicals products. 

Saudi Aramco, a state-owned oil company and the world’s largest crude oil exporter, produce one of every eight barrels of the world’s supply, according to its website.