Aramco has announced the start of construction on an integrated refinery and petrochemical complex in northeast China, which is being developed by its joint venture Huajin Aramco Petrochemical Company (HAPCO).

The downstream greenfield project in Panjin City, Liaoning Province will feature a refinery with a capacity of 300,000 barrels per day (bpd) and a petrochemical plant.

According to Aramco, the petrochemical facility will annually produce 1.65 million metric tons of ethylene and two million metric tons of paraxylene.

Aramco downstream executive vice president Mohammed Al Qahtani said: “This complex is a cornerstone of our efforts to support a world-class, integrated Downstream sector here in China, as petrochemicals will play a vital role in our joint success.

“Once complete, we believe HAPCO will be a model for China’s modern petrochemicals industry moving forward, able to deliver lower carbon products, chemicals, and advanced materials.”

The downstream complex is anticipated to be 100% operational by 2026.

Aramco said that it expects providing feedstock of up to 210,000bpd of crude oil feedstock to the refinery and petrochemical project.

Aramco holds a stake of 30% in HAPCO and is partnered by NORINCO Group (51%) and Panjin Xincheng Industrial Group (19%). The joint venture was set up in late 2019.

Recently, Aramco signed agreements to take a stake of 10% in China-based Rongsheng Petrochemical for CNY24.6bn ($3.6bn). The deal will help the Saudi Arabia-based energy company in substantially growing its downstream footprint in China.

Under a long-term sales agreement, Aramco will deliver 480,000bpd of Arabian crude oil to Rongsheng’s affiliate Zhejiang Petroleum and Chemical.

Along with its commitment to the HAPCO joint venture, Aramco will provide a total of 690,000bpd of crude oil as feedstock in China. This is said to align with the company’s strategy of converting four million bpd of crude oil to chemicals by the end of this decade.