The Saudi Arabian Oil Company (Aramco) [ARAMCO:AB] has signed a Memorandum of Understanding (MoU) with Chinese state-owned coal mining company Shandong Energy to collaborate on crude oil supply and green technologies including hydrogen, renewable energy, and carbon capture and storage (CCS), as reported by ZAWYA on December 9. By collaborating with Shandong Energy, Aramco wishes to build a downstream sector in Shandong Province, including a potential crude oil supply agreement and chemicals products offtake agreement. The signing ceremony was held with support from the Shandong Provincial People’s Government, which highlights the strategic importance of the collaboration between Aramco and Chinese companies.

To better align with China’s goals to peak carbon emissions by 2030 and achieve carbon neutrality by 2060, Shandong Energy, whose core business was coal mining, is expanding its business into petroleum, hydrogen energy, and renewable energies. The collaboration with Aramco marks Shandong Energy’s effort to diversify its energy sources and develop green technologies. Saudi energy businesses such as Aramco have been key partners to Chinese companies in their ventures into renewables. Prior to the Aramco-Shandong agreement, Saudi Arabian private utility ACWA Power also signed MoUs with nine Chinese companies to jointly develop clean and renewable energy projects in Saudi Arabia and Belt and Road Initiative (BRI) Countries.

Sources:

https://www.zawya.com/en/press-release/companies-news/aramco-and-shandong-energy-collaborate-on-downstream-projects-in-china-s2xhauvt

https://sghexport.shobserver.com/html/baijiahao/2022/12/11/919509.html

https://www.aramco.com/en/news-media/news/2022/aramco-and-shandong-energy-collaborate-on-downstream-projects-in-china

https://www.acwapower.com/news/acwa-power-signs-strategic-agreements-with-nine-chinese-entities/