Dubai: Saudi Aramco and Saudi Basic Industries have decided to re-evaluate their $20 billion crude-oil-to-chemicals project and are now looking at integrating existing facilities instead.
The decision comes as oil companies globally re-assess energy projects to conserve cash, with a collapse in demand caused by the coronavirus pandemic threatening to keep crude prices weak for a long time.
Aramco and petrochemical producer SABIC in 2017 signed a preliminary deal to build a $20 billion complex to convert crude oil to chemicals.
But in a statement on Sunday, SABIC said the two companies were now considering the integration of Aramco's existing refineries in Yanbu with a mixed feed steam cracker and downstream olefin derivative units.
"SABIC and Saudi Aramco remain committed to continue advancing crude to chemicals technologies through existing development programs with the goal to increase cost efficiency, competitiveness and value creation opportunities for petrochemicals," the statement said.