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Saudi Aramco signs a dozen multi-billion dollar deals with Korean firms



State owned oil giant Saudi Aramco has signed twelve agreements with major South Korean companies, with the intention of reinforcing relationships with the nation and expanding international operations.

Representatives of Saudi Aramco and various Korean firms signed 12 agreements worth billions of dollars
(Image via Saudi Aramco)

They also hope that expansion of Arabian crude oil supply to Asian markets will help support the region’s energy security.

The agreements include:

Hyundai Heavy Industries

  • Manufacturing JV

Saudi Aramco have entered into a joint venture agreement with Hyundai Heavy Industries to establish an engine making facility in Saudi Arabia. 
Saudi Aramco will hold 55% of the JV, while HHI will own 30% and Saudi Arabian Industrial Investments Company (Dussur) will hold the remaining 15%. The facility will manufacture engines and provide aftersales service for the Kingdom.

  • Collaboration extension

A Memorandum of Understanding (MoU) was signed between the Saudi Aramco and Hyundai Heavy Industries that extends the existing collaboration to develop ship building, engine manufacturing, refining and petrochemicals.

  • Equity share agreement

An agreement was reached to increase Hyundai Heavy Industries’ equity share in the International Maritime Industries - a joint venture between HHI and Saudi Aramco that was launched in December 2017.This 12 million square metre integrated maritime yard is set to be one of the largest full-service maritime facilities when it becomes fully operational in 2022. The new agreement will increase HHI’s share from 10% to 20%.

  • MoU for further cooperation

An MoU was signed between HHI, Bahri and IMI that will cover shipbuilding and transportation as potential areas of cooperation.

  • MoU for exploration of new opportunities

Another MoU was signed between Hyundai Heavy Industries and IMI that will explore further business opportunities in the shipbuilding business.

Hyundai Oilbank

  • Sales agreement

A sales agreement was signed for Saudi Aramco to supply Arabian crude oil to Hyundai Oilbank

  • Sales agreement

A second sales agreement was signed for the subsidiary Aramco Trading Company to supply non-Arabian crude oil to Hyundai Oilbank.

Hyundai Motor Group

  • MoU for expansion

An MoU was signed between Saudi Aramco and Hyundai Motor Co. to explore the use of advanced non-mettalic materials in various fields including the automotive industry, and to collaborate strategically to accelerate the expansion of the hydrogen ecosystem in both Saudi Arabia and South Korea.

Korea National Oil Corp.

  • MoU for exploration of opportunities

A signed MoU will allow Saudi Aramco to explore the potential of crude oil storage in South Korea to complement its marketing and supply activities.

Hyosung Group

  • MoU for construction

Hyosung Group will build a carbon fibre manufacturing facility in Saudi Arabia, having entered into an MoU with Saudi Aramco. The MoU will also provide a collaboration platform for the two companies on R&D and deployment of carbon fibre technology.

GS Holdings

  • Investment MoU

An MoU was entered into between Saudi Aramco and GS Holdings that will aim to identify specific investment opportunities in the Kingdom.

Daelim Industrial

  • Collaboration agreement

Daelim Industrial and Saudi Aramco have agreed to collaborate on petrochemical projects and have signed a new MoU to foster collaboration on value-added chemical products in the Kingdom.

The twelve deals are said to be worth billions of dollars and will strengthen relationships between the two countries.

Saudi Aramco President and CEO, Amin H. Nasser commented on the deals:

“Only a few decades ago, Korean companies played a vital role in Saudi Aramco’s upstream offshore growth development. Since then, they have moved into other sectors matching Saudi Aramco’s diversification strategy. Today’s agreements mark a new era of cooperation with our Korean partners who will play an increasingly important role in our strategy to capitalize on new initiatives that include long-term energy supply, maritime and infrastructure development, and breakthrough research and development in the automotive, crude to chemicals, and non-metallic sectors.”

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Saudi Aramco signs a dozen multi-billion dollar deals with Korean firms - Time to read 4 min
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