BEIJING — The long standing relationship between Saudi Arabia and China can be further amplified with a host of new business and economic opportunities ranging from energy collaboration, knowledge and technology transfer, as well as innovation-driven industries, benefiting both countries and beyond, said Amin Nasser, Saudi Aramco president and chief executive officer, Sunday at the China Development Forum (CDF) here.
This year’s Forum took place just after the historic state visit to China by Custodian of The Two Holy Mosques King Salman.
Highlighting various opportunities for mutual growth, Nasser told ministers, officials and captains of industries that Saudi Arabia provides China’s defining strategic economic initiatives with an ideal platform for prosperous trade between the Middle East and Asia, providing the vital trade link to other regions surrounding the two.
“We in Saudi Arabia have been closely following China’s three defining strategic economic initiatives — “Go Global”; “Belt and Road”; and “Made in China 2025”. That interest has only intensified with last year’s launch of “Saudi Vision 2030” and the parallels it has with all three. As a result, enormous opportunities are opening up for our countries and companies to seize,” he said at CDF’s Session III themed Made In China 2025 and Structural Reforms.
“As President Xi said during King Salman’s state visit that both our countries should deepen cooperation in the energy sector, Saudi Aramco stands ready for opportunities to invest and to collaborate, and for opportunities that would bring our two nations even closer together,” Nasser said.
He outlined three areas that could emerge from this dynamic synergy between both countries which augurs well for companies across a broad spectrum of industries.
The first opportunity is about enhancing two-way investment flows between the two countries, which would help with both China’s “Go Global” and “Belt and Road”, as well as Saudi Vision 2030.
“Chinese companies can benefit from the Kingdom’s strategic location on the Maritime Silk Road by establishing manufacturing, logistical and R&D bases, especially on the west coast of Saudi Arabia.
“From there, they can easily access large markets in the wider Middle East North Africa region, all the way up to Europe and they can also easily access the Kingdom’s vast energy resources and supply of petrochemicals,” he said.
“Equally, with the right opportunities, we would like to further strengthen our oil supply relationship and multiply our investments in China, particularly in the downstream.”
The second area is actually aligned with the Paris Climate Agreement. It is anticipated that hydrocarbons will still be meeting a significant portion of the world’s primary energy demand even a quarter of a century from now, and all sources of energy would be needed.
“However, we must deal with carbon emissions in line with the Paris Agreement on Climate Change. This is where hydrogen and Carbon Capture Utilization and Storage could be game-changers for Saudi Arabia and China,” he said.
Although hydrogen mostly comes from gas, it could also increasingly come from oil and coal, Nasser explained. “If Carbon Capture, Utilization, and Storage and hydrocarbons can be made to work together, then green hydrogen is within our reach,” he said.
This can revolutionize future mobility; in fact hydrogen-based fuel cell vehicles are not far behind electric vehicles while hydrogen-based fuel cells also have the power to revolutionize electric power generation.
When combined with CCUS, Saudi Arabia could convert its vast oil and gas resources into clean hydrogen-based mobility and power while China could convert its vast coal resources into clean hydrogen-based electricity, Nasser said during his panel remarks. The third area is “non-combustible” uses of oil to turn it into a variety of new materials.
Saudi Aramco’s Crude-to-Chemicals initiative which aims to directly convert crude into petrochemicals, eliminating the entire refining step of the process, could change the competitive dynamics of petrochemical feedstocks and assist in developing advanced new materials as well as enable new uses.
That could positively have an impact with New Materials as part of the ten focus areas of Made in China 2025.
Apart from speaking at the CDF, Nasser’s agenda in Beijing also involved the signing of two memoranda of understanding (MOUs) between Saudi Aramco and China North Industries Corporation (Norinco Group) and Aerosun Corporation.
The MOU with Norinco enables further strategic cooperation and downstream investment opportunities in China, which include the development of a refinery and chemical facilities. The MOU with Aerosun would involve manufacturing of reinforced thermoplastic (RTP) pipe as well as R&D.
Nasser also held several bilateral meetings with leaders of key Chinese entities. They include Wang Yupu, Chairman of Sinopec; Wang Jianlin, Chairman of Wanda Group; and Huang Danhua, Vice Chairman of State-owned Assets Supervision and Administration Commission of the State Council (SASAC). He also attended the Saudi-Chinese Investment Forum, which was presided by King Salman.
He also attended the closing ceremony of the Roads of Arabia exhibition, which was presided by King Salman and Chinese President Xi Jinping. The exhibition, which was on its Asian tour, was launched last December with China as the first location, sponsored by Saudi Aramco.
Nasser also attended the inauguration of the King Abdulaziz Public Library branch at the Peking University by King Salman where the Saudi monarch was also conferred an honorary doctorate by the university.
The library’s role is to motivate cultural communication between the Arab world and China, as well as providing a conducive platform for researchers. It is expected to further enhance bilateral relations and strengthen the bridge of cultural and social ties between both nations.
CDF is China’s most preeminent platform for dialogue between China’s senior leadership and representatives from global leading businesses, international organizations, and scholars from home and abroad. This is the forum’s 18th edition since its debut in 2000.
The theme of this year’s Forum – “China and the World: Economic Transformation through Structural Reforms”, addresses key topical issues concerning China and the world at this time of profound global uncertainties, including the economy and industry, international relations, public policy, sustainable development, health and welfare, finance, and technology and innovation. — SG