SEOUL — State-owned Saudi Aramco plans to invest up to $1.6 billion for a nearly 20 percent stake in South Korean refiner Hyundai Oilbank, expanding its foothold in one of its biggest Asian buyers of crude oil.

Saudi Aramco is already the biggest shareholder in South Korea’s No.3 refiner, S-Oil Corp, with a 63.41 percent stake, and the latest deal should help Aramco boost crude oil sales to Hyundai Oilbank, the South’s smallest refiner by capacity.

Saudi Aramco’s chief executive told Reuters in November that it planned to expand its market share in Asia — including China, India, Malaysia and Indonesia — and Africa.

Saudi Aramco plans to pay 1.8 trillion won for a stake of up to 19.9 percent of Hyundai Oilbank from Hyundai Heavy Industries Holdings, which now owns 91.13 percent of Hyundai Oilbank.

“Saudi Aramco seems to be boosting investments in downstream projects ahead of an initial public offering,” said Lee Dong-wook, an analyst at Kiwoom Securities.

In 2018, South Korea imported 323.17 million barrels of crude from the kingdom, or 885,408 barrels per day (bpd), according to data from Korea National Oil Corp.

Aramco, the world’s largest crude producer, plans to increase investment in refining and petrochemicals in a bid to cut its reliance on crude as demand for oil slows.

Hyundai Oilbank has a total of 650,000 barrels per day of refining capacity in the southwestern city of Daesan and also aims to expand its petrochemical business.

In May last year, it announced plans to build a 2.7 trillion won petrochemical plant with South Korea’s Lotte Chemical.

Hyundai Heavy is part of a joint venture with Saudi Aramco and others to build a shipyard on Saudi Arabia’s eastern coast.