Caixin Media, September 11th (Reporter Luo Yichen) The insider trading case that was hotly discussed in the market does not seem to have affected the cooperation between Rongsheng Petrochemical (002493.SZ) and Saudi Aramco. Today evening, Rongsheng Petrochemical announced that the two parties signed the "Framework Agreement for Joint Development Agreement" in Riyadh on September 11th, which is used to standardize the joint activities required for the development and expansion project of Jubail Refining Company.

According to the information, the cooperation being promoted by both parties involves the acquisition of equity of the two companies and related project expansion matters, so the overall pace of cooperation is slow. In simple terms, the two companies plan to mutually acquire part of each other's subsidiary's equity, deepening the binding of interests through this cross-investment form, and laying the foundation for further cooperation between the two parties at the business level.

Regarding this round of cooperation, in January of this year, Rongsheng Petrochemical first announced the "Memorandum of Understanding," stating that both parties were discussing Rongsheng Petrochemical's (or its affiliates) proposed acquisition of a 50% equity interest in Saudi Aramco Jubail Refining Company (referred to as "SASREF") and plans to increase capacity through expansion. At the same time, the two parties are also discussing the potential acquisition of no more than 50% equity of Ningbo Zhongjin Petrochemical Co., Ltd. (referred to as "Zhongjin Petrochemical") by Saudi Aramco (or its affiliates), and jointly developing the upgrade and expansion of existing Zhongjin Petrochemical facilities and the development of the Rongsheng New Materials (Zhoushan) project.

By April this year, the two parties confirmed the cross-investment of a 50% equity interest and carried out project expansion, and signed the "Cooperation Framework Agreement." After determining the overall framework of the cooperation, in September, the two parties reached a consensus on the expansion of Jubail Refining Company. As for the core contents of concern in the market, such as investment amount and cooperation method, Rongsheng Petrochemical emphasized that it still needs to be based on subsequent agreements.

It is reported that behind Saudi Aramco's deepening cooperation with Rongsheng Petrochemical is Saudi Arabia's promotion of its own energy transformation through a series of overseas investments. Among them, China is one of its important overseas markets. At the same time as Rongsheng Petrochemical announced the latest progress in the cooperation between the two parties, the matter of Saudi Aramco's acquisition of approximately 10% equity of Hengli Petrochemical (600346.SH) is also in progress.

Market attention is focused on whether Saudi Aramco's acquisition of Hengli Petrochemical's equity will repeat the same mistakes. In 2023, Saudi Aramco completed the acquisition of approximately 10% equity of Rongsheng Petrochemical at a transaction price of 24.30 yuan/share. After that, Rongsheng Petrochemical's stock price continued to decline, and Saudi Aramco's investment in this regard was jokingly referred to as a "big loss" by many investors. Then, in August of this year, several individuals under the parent company of Rongsheng Petrochemical, Rongsheng Group, were exposed to insider trading through buying and selling stocks before and after this cooperation, once again attracting market attention to this investment.