Aramco to divest Malaysian refining assets

Petroliam Nasional Bhd. (PETRONAS) subsidiary PETRONAS Refinery & Petrochemical Corp. Sdn. Bhd. (PRPC) has agreed to buyout Saudi Arabian Oil Co.’s (Aramco) equity interests in the partners’ dual 50-50 joint ventures responsible for operating the 300,000-b/d integrated refining and petrochemical refinery of the Pengerang Integrated Complex (PIC) in southeastern Johor, Malaysia.

Subject to fulfillment of customary closing conditions, Petronas will take 100% ownership and become full operator of Pengerang Refining Co. Sdn. Bhd. and Pengerang Petrochemical Co. Sdn. Bhd., collectively known as PRefChem, Aramco and Petronas said in separate releases.

Aramco said divestment of the Malaysian assets will support the strategic optimization of the company’s own downstream portfolio by providing additional flexibility to pursue investments aligned with its broader downstream strategy.

While Aramco will no longer hold ownership in the Malaysian ventures, the company said it will continue actively explore commercial arrangements with Petronas following the sale, including continuing its existing agreement to supply Saudi Arabian crude oil to the site, as well as opportunities related to technology exchange and integrated product distribution.

Petronas said its move to take full control of the downstream assets will allow the company to further enhance operational alignment and flexibility across PRefChem’s value chain, while harnessing its international oil supply network and integrated operating model to support continued reliability and resilience across varying market conditions.

Full ownership of PRefChem’s in-country operations also will strengthen Petronas’ ability to support Malaysia’s long-term energy security and industry resilience, the operator said.

A definitive timeframe for when the parties expect to finalize the proposed transaction was not revealed.

PRefChem operations

In addition to the Johor refinery, PRefChem’s operations at PIC include a steam cracker complex equipped to produce 3.4 million tonnes/year (tpy) combined of ethylene, propylene, butadiene, benzene and raffinate-2.

PRefChem also operates an associated petrochemical complex at the site that uses feedstock from the steam cracker to produce 3.3 million tpy of polymers, glycols, and specialty chemicals including:

• High-density polyethylene.
• Linear low-density polyethylene.
• Polypropylene.
• Monoethylene glycols.
• Diethylene glycols,
• Triethylene glycols.
• Isononanol.
• Nitrile butadiene latex.