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Exxon bringing Saudi partner to U.S. petrochemicals

Oil and gas companies signing deals with Saudi counterparts to expand Middle East footprint

By Daniel J. Graeber
Exxon bringing Saudi partner to U.S. petrochemicals
Exxon Mobil is bringing Saudi partner to Texas to help expand a regional facility that draws on U.S. natural gas. The company was one of several reaching agreements during U.S. President Donald Trump's first visit overseas since taking office. Photo by Oskari Porkka/Shutterstock

May 22 (UPI) -- Exxon Mobil said it was bringing its Saudi partners to a U.S. facility, though other companies in talks in Riyadh agreed to expand their regional presence.

U.S. President Donald Trump led White House officials to Riyadh to mark his first-ever state visit since taking office. On the sidelines of the visit, affiliate companies of U.S. supermajor Exxon Mobil Corp. signed agreements with Saudi Basic Industries Corp. to start planning a petrochemicals project in Texas that's part of Exxon's Gulf Coast expansion efforts.

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Both parties before the visit had already picked a site in Texas for a facility that would process 1.8 million tons of petrochemical products per year. It's one of 11 associated with Exxon's regional growth initiative that draws on U.S. shale natural gas assets. Aligning with the U.S. president's pro-energy economic policies, the company said the deal with SABIC would add to projects expected to create more than 12,000 full-time jobs.

U.S. Secretary of State Rex Tillerson was the head of Exxon before joining the Trump administration. From the podium in Riyadh, Saudi Foreign Minister Adel al-Jubeir said the United States is the largest national investor in Saudi oil and Exxon is the largest single corporate investor in Saudi Arabia.

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"The kingdom of Saudi Arabia has been a good home for American investments," he said in a weekend statement.

Elsewhere, oil and gas services contractor McDermott International, which has headquarters in Houston, signed a memorandum of understanding with the Saudi Arabian Oil Co., known commonly as Saudi Aramco, that has an estimated value of $2.8 billion. According to McDermott, it was the only U.S. company of its kind that took part in a joint CEO forum in Riyadh.

The agreement gives McDermott a broader regional reach and increases the number of Saudi nationals in its Middle East workforce to 40 percent by 2030.

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"As part of our global strategy to enhance our capabilities and deepen customer relationships, this MOU strengthens our long-term plans to transition our Middle East operations to Saudi Arabia, which we believe positions us competitively in the regional market," CEO David Dickson said in a statement.

Finally, Schlumberger, the largest oilfield services company in the world with one principle office in the United States and three in Europe, signed an MOU with Saudi Aramco to help develop the Saudi oil and gas services industry.

"For more than 75 years, Schlumberger has supported Saudi Aramco and the kingdom of Saudi Arabia's oil and gas industry through an unwavering commitment to train and develop Saudi talent," CEO Paal Kibsgaard said in a statement.

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