China's Sinopec invited to invest in Saudi Aramco IPO

HONG KONG (Bloomberg) -- China Petroleum & Chemical Corp. said it was invited to invest in Saudi Arabian Oil Co. as part of what could be the world’s biggest-ever initial public offering.

Talks are ongoing between the companies known as Sinopec and Saudi Aramco, Wang Yupu, chairman of the Chinese refiner, said on Monday. During a visit to China this month, Aramco’s chief executive officer Amin Nasser told officials he hoped the company could invest in the listing, Wang said.

Saudi Arabia is preparing for the flotation by deepening relationships with its biggest buyers and locking in future demand for its oil. Saudi King Salman bin Abdulaziz led a delegation to Asia this month that saw the Middle East explorer pledge at least $13 billion worth of investments in refining projects.

“We talked with them on the plan, and generally speaking we had a very good conversation,” Wang said of the offer from Aramco, speaking during a briefing in Hong Kong. “Going forward, based on our own reality and needs, we will get into more detailed conversations with them.”

A Saudi Aramco spokesman declined to comment.

China is growing more reliant on overseas crude as its domestic reserves dwindle and economic growth spurs higher demand. China’s $814-billion sovereign wealth fund, China Investment Corp., and Sinopec-rival China National Petroleum Corp. may invest in the IPO, Bloomberg News reported earlier this month.

President Xi Jinping said in a meeting with King Salman that the nations should step up energy cooperation, Xinhua News Agency reported March 16, adding that the countries signed $65-billion worth of memorandums of understanding during the visit.