SINGAPORE (Dow Jones)
South Korean companies are looking to participate in Saudi Arabia's Jubail and Yanbu refinery projects worth $12 billion, South Korea's Ministry of Commerce, Industry and Energy said Monday.
Energy minister Kim Young-Joo and Saudi oil minister Ali Naimi exchanged views on 10 projects in the kingdom worth about $16.4 billion that South Korean companies are interested in, including the two refinery projects, the ministry said in a statement.
"Particularly, during the meeting with Al Naimi, regarding the Jubail and Yanbu export refinery projects, Naimi took note of our companies' experience in building refineries and technology," it said.
An official at the Ministry, who declined to be named, said Aramco may invite bidding in the first half of this year and many South Korean companies are likely to participate, without elaborating further.
Each refinery, which will run Arabian Heavy crude, will have a refining capacity of 400,000 barrels a day and produce gasoline, low-sulfur diesel and naphtha for markets in Asia, Europe and the U.S.
Both projects are scheduled to start operations around mid-2011.
Saudi Arabian Oil Co. (SOI.YY) or Aramco, signed a preliminary agreement in May 2006 with Total S.A. (TOT) to build the Jubail refinery, which will be owned by Aramco and Total, who each have 35% stakes.
Aramco signed deals last year with ConocoPhillips (COP) and Kellogg, Brown and Root, a unit of Halliburton (HAL), to start front-end engineering for the Yanbu refinery.
Saudi Arabia, which holds the world's largest oil reserves, has announced a plan to invest $25 billion to expand its refining output by adding 1 million barrels a day of additional capacity by 2012.
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