Saudi Aramco Total Refinery and Petrochemicals Company (Satorp)expects its new refinery at Jubail in Saudi Arabia to be fully operational in December 2013, the joint venture's chief executive said on Tuesday.
State-run Saudi Aramco and France's Total are building the $14-billion Jubail facility as part of a push by the world's top oil exporter to almost double its refining capacity.
"Overall Engineering, Procurement and Construction work at the refinery is 68 per cent complete," Fawwaz Nawwab, CEO of Satorp, told reporters in the Saudi capital Riyadh.
Nawwab said that although the refinery was designed to process 400,000 barrels per day (bpd), Saudi Aramco had committed to supply it with up to 440,000 bpd for 30 years.
Jubail will refine Saudi heavy crude into a range of fuels -- from gasoline to petroleum coke -- for domestic consumption and export.
Around 54 per cent of the project's output will be diesel and jet fuel with an estimated quantity of 11.4 million tonnes a year.
Annual regular gasoline and petcoke production is estimated to be around 2.8 million tonnes and 2.1 million tonnes respectively, said Nawwab, adding that export of these products will depend on seasonal demand within the kingdom.
"Demand fluctuates with the season how much of the production goes to local versus international market depends on demand."
Saudi Arabia heavily subsidises fuel, however Nawwab said that Satorp would still sell its products to Aramco at international prices, Aramco would then bear the costs of re-selling to the domestic market at discounted rates.
"For Satorp, we sell at international price both to Total and Aramco that is the case by the way for other joint venture refineries in Saudi Arabia," he told reporters.
The joint venture is set to issue up to 3.75 billion Saudi riyals ($1 bln) in Islamic bonds to help pay for it . However no decision was made on when an initial public offering (IPO) would be launched.
"The sponsors are committed to maintain their combined equity ownership of 75 per cent in the project," said Nawwab.