Aramco Withdrawing From Troubled Malaysian Mega Refinery

29 May 2026 Issue: 69 / 22 By: Jamie Ingram

Operational setbacks and mounting liabilities at a major downstream complex at Johor, Malaysia appear to have been too much for Aramco. A relaxation of the company’s chemicals target has helped pave the way for an exit from the Pengerang facility.

Saudi Aramco is to exit its Pengerang Refinery & Petrochemical Corporation (PRefChem) joint venture with Malayia’s Petronas, bringing the curtain down on its role in a troubled project. Withdrawing from the venture, which consists of a 300,000 b/d refinery and a 1.2mn t/y steam cracker at Johor, Malaysia, is a setback for Aramco’s plans to expand its liquids-to-chemicals (LTC) capacity to futureproof its operations.

In a 25 May announcement, Aramco said it agreed to transfer its 50% stakes in the refining and petrochemicals entities to Petronas, subject to closing conditions. “The transaction was concluded on mutually agreed terms, reflecting the evolving strategic priorities of both parties,” Aramco said, without providing further detail. It added that the companies will explore future commercial arrangements, including crude oil supply and integrated product distribution. (CONTINUED - 999 WORDS)