Total decision on Saudi refinery before June
Riyadh, February 15, 2008
French oil and gas company Total said it will decide before the end of June whether to go ahead with a planned refinery in Saudi Arabia as it weighs the impact of rising industry costs.
State oil company Saudi Aramco has signed a joint venture with Total for a 400,000 barrels per day refinery to cope with the country's growing crude output capacity.
'We will decide this year, before the end of the first half,' a Total spokeswoman said. 'We have withdrawn from exploration in Saudi Arabia so this is a project that we are keen on,' she added.
The refinery in Jubail was initially expected to cost $6.4 billion. Total believes the cost will be higher but the spokeswoman declined to say by how much.
The Total deal is part of Aramco's wider aim to spend, together with partners, $50 billion by end-2011 to boost refining capacities at home and abroad.
Aramco signed a similar deal with US company ConocoPhillips for a refinery in Yanbu for $6 billion. Higher labour and raw material costs have caused delays and cancellations across the world's oil and gas industry.-Reuters