Saudi Arabian state-owned oil company Aramco has finalised definitive agreements to acquire and offer project financing for the $12bn gasification and power joint venture (JV) in Jazan Economic City (JEC), Saudi Arabia.

The agreements were finalised with Air Products, ACWA Power and Air Products Qudra.

The JV was founded in 2018 to improve the overall value of the Jazan Refinery and an integrated gasification combined cycle power plant.

It aimed to help ‘transform’ the Jazan Province by positioning JEC for additional foreign direct investment and private sector involvement.

Under the terms of the agreement, the JV will purchase utilities, power assets, gasification, syngas cleanup and air separation units from Aramco.

It will own and operate the facility for a period of 25 years under a fixed monthly fee contract.

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The JV serves Aramco’s Jazan Refinery, which has the capacity to process 400,000 barrels of crude oil a day to produce products such as ultra-light sulphur diesel and gasoline.

Aramco has agreed to supply feedstock to the JV to produce power, steam, hydrogen and other utilities.

Aramco Downstream senior vice-president Mohammed Al Qahtani said: “This JV is meant to be central to the self-sufficiency of our megaprojects at Jazan.

“We believe the JV will enhance the overall value of the refinery and integrated gasification combined cycle power plant, and aid in transforming the province by positioning Jazan Economic City for additional foreign investment and private sector involvement.”

The consortium is expected to improve job opportunities in the region and transfer advanced technologies in this field to Saudi Arabia.

All the companies in the JV expect the asset transfer and funding to take place by next month.

Last September, Saudi Aramco and the Institute of Energy Economics, Japan (IEEJ), collaborated with SABIC to send the first shipment of blue ammonia from Saudi Arabia to Japan for use in generating zero-carbon power.