Saudi Aramco and the French oil giant TotalEnergies announced their intent to build a petrochemicals complex in Saudi Arabia at a total cost of $11 billion.

In a joint statement issued on Thursday, the companies said the Amiral complex will be owned, operated and integrated with the existing SATORP refinery located in Jubail on Saudi Arabia’s eastern coast.

Of the total cost, $4 billion will be funded through equity by Aramco (62.5%) and TotalEnergies (37.5%). Its construction is scheduled to begin in the first quarter of 2023, with commercial operations expected to start in 2027.

The petrochemicals facility will enable SATORP to convert internally produced refinery off-gases and naphtha, as well as ethane and natural gasoline supplied by Aramco, into higher value chemicals, helping to advance Aramco’s liquids-to-chemicals strategy.

The complex will comprise of a mixed feed cracker capable of producing 1.65 million tonnes per annum of ethylene, the first in the region to be integrated with a refinery. It will also include two state-of-the-art polyethylene units, a butadiene extraction unit and other associated derivatives units.

Eventually, the complex will provide feedstock to other petrochemicals and specialty chemical plants, located in the Jubail industrial area, which will be built, owned and operated by other downstream investors, entailing an estimated additional $4 billion of investment.

 "This will support the establishment of key manufacturing industries, such as carbon fibers, lubes, drilling fluids, detergents, food additives, automotive parts and tires," the statement said.

The overall complex, including adjacent facilities, is expected to create 7,000 local direct and indirect jobs.

(Writing by Brinda Darasha; editing by Cleofe Maceda)