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12 April 2024

Saudi Aramco-Sumitomo Chem JV losses swell in 2008

Saudi Aramco's joint venture with Sumitomo Chemical, PetroRabigh, suffered massive losses due to the continued decline of oil prices in the global market. (AFP)

By Reuters
PetroRabigh, a joint venture between Japan's Sumitomo Chemical and Saudi Aramco, said net loss almost tripled in 2008 on a drop in prices of refined products and a delay in the start of some units.

The firm made a net loss of SR1.26 billion ($334.9 million; Dh1.2 billion) in 2008 down from SR443 million in 2007, the firm, also known as Rabigh Refining and Petrochemical Co, said in a statement posted on the bourse's website.

Profits were hit by delays in starting production at several new petrochemical plants and refinery units, in addition to losses from "a decline in both the prices of and global demand on oil products", it said.

The firm plans to start commercial production before the end of March despite poor global demand, Chief Financial Officer Toshiki Matsumura told Reuters earlier this month.

Last September, PetroRabigh said it would defer by three months the commercial launch of operations at its $10.3 billion (Dh38 billion) refining and petrochemical plant to the first quarter of 2009.

PetroRabigh started partial operation of its facilities in the fourth quarter of 2008.

Aramco and Sumitomo Chemicals paired up in 2005 to upgrade a 400,000 barrel per day (bpd) oil refinery and add a petrochemical complex.