M&As: Aramco/Sinopec in jv to develop petchem complex in China; Toyota takes 25% stake in LG Chem’s cathode plant

Aramco, one of the world’s leading integrated energy and chemicals companies, China Petroleum & Chemical Corporation (Sinopec), and Fujian Petrochemical Company Limited (FPCL) have announced the establishment of a new joint venture, Fujian Sinopec Aramco Refining and Petrochemical Co., to develop a large-scale integrated refining and petrochemical complex in Fujian province, China. 

The new joint venture was formed through an agreement signed between Aramco, Sinopec and FPCL. Its establishment reflects the long-standing relationship between the parent companies, and underlines their ongoing contribution to China’s energy security and economic growth, the firms add.

The new complex, which was first announced in November 2024, is expected to be operational by the end of 2030.

The joint venture will oversee construction and operation of an integrated refining and petrochemical complex that will include a 16 million tonnes/year crude oil refining unit (equivalent to 320,000 barrels per day); a 1.5 million tonnes/year ethylene unit; a paraxylene and downstream derivatives capacity of 2 million tonnes/year; and a 300,000 tonne-capacity crude oil terminal. 

FPCL, a 50:50 partnership between Sinopec and Fujian Petrochemical Industrial Group, holds an equity interest of 50% in the new joint venture, with Aramco and Sinopec each holding 25% stakes. 

The project represents the third major manufacturing collaboration between Aramco and Sinopec in China, following the successful launch of the Fujian Refining & Petrochemical Company (FREP) project in 2007, and Sinopec SABIC Tianjing Petrochemical Company (SSTPC) in 2009. It is also the fifth joint venture between Aramco and Sinopec, extending their cooperation in refining and chemicals both in China and internationally.

Mohammed Y. Al Qahtani, Aramco Downstream President, said that the company sees significant petrochemical demand growth potential in China, adding, “The new joint venture also strengthens bonds with our Chinese partners, reflecting our shared confidence in the future of China’s economy and our collective determination to contribute to high-quality development and sustainable growth.

In other news, South Korea’s LG Chem Company announced that Toyota Tsusho Corporation, a subsidiary of Japan’s leading vehicle manufacturer Toyota Motor Corporation, has acquired a 25% stake in its cathode active materials plant located in the South Korean city of Gumi.

LG Chem remains the largest shareholder in the plant, which is incorporated as LG-HY BCM Company, with a controlling 51% stake. Toyota Tsusho has become the second-largest shareholder after China’s Zhejiang Huayou Cobalt Company sold it a 25% stake, reducing its own holdings in the company from 49% to 24%.

With the Chinese company downsizing its stake in LG-HY BCM Company to below 25%, the plant now meets the new Prohibited Foreign Entity (PFE) rules introduced by the US government in July 2025, allowing the plant to comply with the US IRA requirements and qualify for US tax credits.

Toyota Tsusho, described as a general trading company, plays a key role in Toyota Motor’s raw materials procurement. LG Chem confirmed that Toyota Tsusho plans to supply a portion of the cathode active materials produced at the plant mainly to battery manufacturing customers in North America.

The LG-HY BCM plant in Gumi is a key production hub for cathode materials, with a production capacity of 66,000 tonnes/year, using the LG Precursor Free (LGPF) process. LG Chem claims that the process, which eliminates precursors and directly sinters the materials from custom-designed metal feedstocks, has helped it become a leading producer in this segment.

LG Chem is currently expanding its global customer base and supply network, with new production facilities in Cheongju and Gumi in South Korea, Wuxi in China, and a new facility in the US state of Tennessee, scheduled to open in the second half of 2026.

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