The Saudi Arabian Oil Company “Saudi Aramco” announced the signing of 9 memoranda of understanding and one additional agreement with Korean entities, which aim to enhance its strategy in the refining and chemicals sector, support the development of hydrogen energy solutions, as well as find new financing options for the company.
The signing ceremony took place during the activities of the Saudi-Korean Investment Forum, which was held in Riyadh and hosted by the Saudi Ministry of Investment, and was attended by President Moon Jae-in, President of the Republic of Korea, the President and Chief Executive Officer of Saudi Aramco, Eng. Amin bin Hassan Al-Nasser, and senior executives of companies in the two countries.
Aramco signed an agreement with Doosan Heavy Industries and Construction in Korea, and the Kingdom’s Industrial Investment Company (Dusur). This partnership aims to establish a metal casting and forming plant that can provide manufacturers in the Kingdom with industrial and processing equipment such as valves, pumps, compressors, well heads, pipelines, heat exchangers, gas and wind turbines in order to enhance local content.
The planned joint venture aims to produce 60,000 tons per year, and is mainly based on sand casting and forming according to open-mould processes, as well as automated processing capabilities. It also has the ability to supply OEMs in the fields of drilling rigs, offshore operations, and engines, with the potential to expand into the Gulf market.
The agreements also include memorandums of understanding with a number of energy companies in Korea, the Korea Electric Power Company (KEPCO), S-Oil, POSCO, Hyundai Oilbank, and the Korea Lotte Chemical Company, in the context of exploring potential cooperation opportunities in the supply, transportation, use and certification of hydrogen and ammonia. The companies are also planning to study the feasibility of converting exported ammonia into hydrogen – a process known as ammonia back cracking. This represents a first step towards establishing a potentially large-scale hydrogen and ammonia production facility in the Kingdom, which will also include carbon capture and storage.
An agreement was signed with the Korean Export-Import Bank (KEXIM) to discuss strategic financing solutions to support the company’s trade and investment activities in which Korean companies participate.
The President of Saudi Aramco, Engineer Amin bin Hassan Al-Nasser, said that these agreements will lead to the exploration of more opportunities with our focus on 4 areas: hydrogen energy development, technologies for direct conversion of liquids to chemicals, metal forming and casting, as well as cooperation in the field of financing with the Export-Import Bank of Korea.
Nasser explained that Aramco is the largest supplier of oil to Korea, and that it has international strategic investments in Korea within its global refining and chemicals system, the most prominent of which are the S-Oil refinery, as well as the Hyundai Bank refinery. In addition, there is an important partnership with Korea in the King Salman International Complex for Maritime Industries and Services in Ras Al-Khair.
The agreements aim to enhance cooperation between Saudi Aramco and Korean companies, and open new opportunities in the fields of advanced technologies, construction, and finance.
And the Doosan and Dussur agreement was signed, to establish a factory for casting and forming metals in the Kingdom.
The memoranda of understanding that were signed in the field of technology, finance and investments included the following:
Korea Electric Power Corporation (KEPCO) – Intent to study the ammonia supply chain.
S-Oil – Agreement to explore potential cooperation in the field of ammonia procurement and logistics.
S-Oil – Agreement to explore opportunities for cooperation in research and development of hydrogen energy solutions
Two separate agreements with POSCO and Hyundai Oilbank to exchange information and explore potential cooperation in the areas of blue ammonia and blue hydrogen.
H2 Korea – Agreement to exchange information on hydrogen certification and regulatory requirements.
S-Oil – Agreement to exchange information related to Saudi Aramco’s technology to convert crude oil into chemicals and explore potential avenues of cooperation.
Korea Export-Import Bank (KEXIM) – Agreement for strategic financing solutions.
S-Oil – Agreement to cooperate in capital investment and start-up financing.
