Saudi Aramco signs Korea deals to boost downstream strategy

Saudi Aramco said late Tuesday it had signed an agreement and nine Memoranda of Understanding (MoUs) with leading Korean entities to advance the company’s downstream strategy, as they look to generate new revenue streams for the company.

The agreement comes in light of Aramco’s goal to support development of low-carbon energy solutions and expand its operations globally.

“In addition to focusing on cutting-edge development in a range of areas, they also support our shared goal of finding climate solutions and lowering greenhouse gas emissions through the development of low-carbon hydrogen and ammonia production, as well as carbon capture and storage,” said Amin H. Nasser, Aramco President and CEO.

The low carbon energy solutions agreements include MoUs with Korean energy companies KEPCO, S-Oil, POSCO, Hyundai Oilbank, H2Korea and Lotte Chemical. Aramco said that through these MoUs, they wanted to explore potential collaboration in the supply, transportation, utilisation and certification of hydrogen and ammonia.

“Together, these initiatives with Korea’s industry leaders will further enhance our downstream expansion and integration strategy,” Nasser said.

The companies said they will conduct a feasibility study to understand how to convert exported ammonia into hydrogen.

“This represents a first step towards a potential large-scale production facility for hydrogen and ammonia in Saudi Arabia, which would also include a Carbon Capture and Storage (CCS) facility,” Aramco said in a statement.

Along with Korea’s Doosan Heavy Industries & Construction Company, Aramco will produce a target of 60,000 tons per year primarily from sand-casting and open-die forging processes, complemented by machining capabilities.