KUALA LUMPUR, Feb. 27 (Xinhua) -- Saudi Aramco, Saudi Arabia's national petroleum and natural gas company, will invest 7 billion U.S. dollars in a joint venture refinery with Malaysia's Petronas, Malaysian Prime Minister Najib Razak said on Monday.
Najib made the announcement after a meeting with the Saudi ruler, Salman bin Abdulaziz Al-Saud, who is on a four-day visit to Malaysia.
This investment has a huge significance for Malaysia, Najib told reporters. More details will be revealed on Tuesday, when Najib and King Salman will witness a signing ceremony between the two companies.
According to an introduction posted on Petronas' website, the project, called Refinery and Petrochemical Integrated Development or RAPID, is located in Pengerang in the southern state of Johor. Once completed in 2019, the refinery will have a capacity of 300,000 barrel-per-day and the Steam Cracker will have a combined annual production capacity of more than 3 million tonnes of Ethylene, Propylene and C4 - C6 olefins products.
The announcement marked a turn-around for the project, as the Wall Street Journal reported earlier that Saudi Aramco had pull out of the negotiations after a feasibility study concludes that it will not generate sufficient
When asked about whether the initial public offering of Saudi Aramco in 2018 will involve Malaysia, Najib said "we will come to that later. We focus on Pengerang," which "took three weeks of very intensive negotiations day and night."
Saudi Arabia is Malaysia's second-largest trading partner in the Middle East, according to government figures. Trade between the two countries saw a 19.8 percent surge in 2016, totalling 13.12 billion ringgit (2.95 billion U.S. dollars).