Saudi Aramco has pulled out of a planned joint venture with Malaysia’s state-owned oil company Petronas, concerning the construction and operation of a major $27b refining and petrochemical project in southern Malaysia, Oil Price reported.
The Refinery and Petrochemical Integrated Development (RAPID) project, launched in 2012 and expected to begin operations in the first quarter of 2019, is designed to have a 300,000b/d of oil refinery and a petrochemical complex with a production capacity of 7.7m tons, Reuters informed.
No reasons were given for the shelving of the project by the two companies, however, Aramco is said to have concluded a feasibility study that indicated that the project will not yield the desirable level of returns.
Aramco’s move to suspend plans for the Malaysian venture comes at a time when Petronas is struggling with the slump in oil prices.
Meanwhile, Petronas is also yet to make a final investment decision (FID) on a controversial $27b liquefied natural gas project in Canada that has brought about criticism from aboriginal and environmental groups.