Saudi Aramco to sell LPG to China’s Sinopec Fuel: report

Saudi Aramco has signed a one-year term contract with China’s Sinopec Fuel Oil Sales Co Ltd, a wholly-owned subsidiary of state-owned Sinopec, to supply liquefied petroleum gas (LPG) cargoes for delivery in 2018, Platts reported, citing an unnamed source.

The cargoes, which will comprise both propane and butane, are expected to start delivery in the first quarter of 2018, the source said.

The cargo under the contract will be priced according to Saudi Aramco's monthly contract prices (CPs) on a free on board (FOB) basis, just like its other term contracts, Platts reported, without giving details on the total volume of the contract.

In February 2016, Saudi Aramco signed its first term contract directly with Wanhua Chemical, China's propane dehydrogenation plant operator, and has subsequently renewed the annual term contract.

Saudi Aramco is the fourth biggest LPG supplier to China, mostly through international trading companies, the report said.

China's LPG apparent demand has posted double-digit growth every year since 2013, with volume reaching around 49.84 million metric tons (MT) in 2016, surging 79 percent from 27.91 million MT in 2013, Platts said.