Fangda Partners acted as PRC legal counsel to Saudi Arabian Oil Company (hereinafter, “Saudi Aramco”) in connection with its strategic investment in two significant Chinese petrochemical companies and the entering into of a series of commercial arrangements.

On March 26, 2023, Saudi Aramco signed the definitive agreements in relation to a joint venture with NORINCO Group and Panjin Xincheng Industrial Group, in which Saudi Aramco will hold 30% of equity interest. The parties will jointly construct a refinery and petrochemical complex in Panjin, Liaoning. The refinery and petrochemical complex is expected to be fully operational by 2026. The complex shall combine a 300,000 barrels per day refinery and a petrochemical plant with an annual production capacity of 1.65 million metric tons of ethylene and 2 million metric tons of paraxylene. Saudi Aramco will supply up to 210,000 barrels per day of crude oil feedstock to the complex.

On March 27, 2023, Saudi Aramco’s subsidiary, as a foreign strategic investor, signed a share purchase and sale agreement with Zhejiang Rongsheng Holding Group Co., Ltd., purchasing 10% plus one share of the listed company, Rongsheng Petrochemical Co. Ltd. (hereafter, “RS ListCo”), for RMB24.6 billion. Meanwhile, Saudi Aramco and its subsidiaries signed the Strategic Cooperation Agreement and a series of strategic agreements with RS ListCo and its subsidiaries. The parties will cooperate in crude oil purchase, feedstock supply, chemicals sales, refined and chemical products sales, crude oil storage and technology, in particular, Saudi Aramco will provide a long-term stable supply of 480,000 barrels per day of crude oil to RS ListCo and its subsidiaries.

Saudi Aramco is a comprehensive international crude oil group with years of history. It is the largest integrated energy and chemicals company and the largest oil company in the world. Its main business includes petroleum exploration, development, production, refining, transportation and sales, etc., and has been listed on Tadawul since 2019. RS ListCo is listed on Shenzhen Stock Exchange, its subsidiary ZPC operates the largest integrated refined and chemical complex in China.

The different practice groups within Fangda cooperated closely in these two transactions, acting as an integrated team, and providing comprehensive legal services to Saudi Aramco covering corporate law, capital markets, project financing, anti-trust and national security review, and labor law.

Fangda’s team providing services to Saudi Aramco was led by corporate team partners Fang Jian and Pan Siyuan, with support from partners Jiang Xueyan and Cong Dalin from Capital Market team, Michael Han and Caroline Huang from Anti-trust team, Kang Yingjie from Compliance team, Romy Zhuo from Banking team and Zhou Bo from Employment team. The other key team members include counsel Sam Wang and counsel Eunice Dai.