The Saudi Arabian Oil Company “Saudi Aramco” announced the signing of nine memorandums of understanding and one additional agreement with Korean entities, with the goal of improving the company’s refining and chemicals strategy, assisting in the development of hydrogen energy solutions, and finding new financing options.
The signing ceremony took place during 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, Eng. Amin bin Hassan Al-Nasser, President and Chief Executive Officer of Saudi Aramco, and senior executives from both countries.
Doosan Heavy Industries and Construction in Korea and the Kingdom’s Industrial Investment Company struck a deal with Aramco (Dusur). This cooperation seeks to build a metal casting and forming factory that will supply industrial and processing equipment to manufacturers in the Kingdom, including valves, pumps, compressors, wellheads, pipelines, heat exchangers, gas, and wind turbines, in order to boost local content.
The planned joint venture, which seeks to manufacture 60,000 tons per year, would primarily rely on sand casting and forming using open-mold technologies, as well as automated processing. With the potential to develop into the Gulf market, it can also serve OEMs in the sectors of drilling rigs, offshore operations, and engines.
In the context of exploring potential cooperation opportunities in the supply, transportation, use, and adoption of hydrogen and ammonia, the agreements also include memorandums of understanding with a number of Korean energy companies, including the Korea Electric Power Corporation (KEPCO), S-Oil, POSCO, Hyundai Oilbank, and the Korea Lotte Chemical Company. The businesses also want to investigate the viability of turning exported ammonia into hydrogen using an ammonia reverse cracking method. This is a preliminary step toward the Kingdom developing a large-scale hydrogen and ammonia manufacturing complex that will also incorporate carbon capture and storage.
The Korean Export-Import Bank (KEXIM) and the corporation struck an agreement to examine strategic financing alternatives to boost the company’s a trade and investment activities with Korean companies.
Engineer Amin bin Hassan Al-Nasser, President of Saudi Aramco, stated that these agreements will lead to the exploration of more opportunities, with a focus on four areas: hydrogen energy development, direct conversion of liquids to chemicals, metal forming and casting, and financing cooperation with the Export-Import Bank of Korea.
Nasser stated that Aramco is Korea’s top oil supplier and that the company has international strategic interests in Korea as part of its global refining and chemicals system, the most notable of which are the S-Oil refinery and the Hyundai Bank refinery. At addition, the King Salman International Complex for Maritime Industries and Services in Ras Al-Khair has a significant partnership with Korea.
The agreements seek to strengthen Saudi Aramco’s relationships with Korean firms and provide new prospects in sophisticated technology, construction, and finance.
Also inked was a deal between Doosan and Dussur to build metals casting and forming facility in the Kingdom.
The following memorandums of the agreements were signed in the fields of technology, finance, and investments:
-Korea Electric Power Corporation (KEPCO) aims to investigate the ammonia supply chain.
-S-Oil – Agreement to investigate the possibility of collaborating in the area of ammonia procurement and logistics.
-S-Oil – Agreement to investigate prospects for collaboration in hydrogen energy research and development.
-Two separate agreements with POSCO and Hyundai Oilbank in the areas of blue ammonia and blue hydrogen to share information and explore possible collaboration.
-H2 Korea – An agreement to share information on hydrogen certification and regulatory requirements has been reached.
-S-Oil – Agreement to share information on Saudi Aramco’s technology for converting crude oil into chemicals and to look into other areas of collaboration.
-Agreement for strategic financing solutions with the Korea Export-Import Bank (KEXIM).
-S-Oil – Collaboration in capital investment and start-up finance.
Agreement on green hydrogen storage
POSCO and Samsung CT have agreed to collaborate on technological development of liquid nitrogen for worldwide green hydrogen generation and storage in 2021.
According to the Saudi Press Agency, POSCO is trying to promote and boost hydrogen production initiatives, with the goal of being one of the top ten producers in the world by 2050. It plans to manufacture up to 7 million tons of hydrogen, with investments now aiming for half a million tons. By 2030, it will be worth 10 trillion won.
As part of its future growth ambitions, Samsung CT will build its green hydrogen business, which will deliver environmentally friendly energy solutions. Taking advantage of its global expertise delivering renewable energy projects, particularly in the Middle East, which is a key market for its green hydrogen company.
She explained that this step is part of the Public Investment Fund’s efforts to develop new and promising sectors in the Kingdom, including the energy sector, in accordance with the Fund’s strategy 2021-2025, because the project will help diversify the Kingdom’s economy and contribute to Vision 2030’s goals, as well as the Fund’s success. In the Kingdom’s development of new and sustainable industries, including as renewable energy and waste management.