Chinese state-run oil giant Sinopec announced Monday an agreement with Saudi counterpart Aramco to establish a joint venture with a registered capital of 28.8 billion yuan ($3.95 billion), as Riyadh continues to deepen economic ties with Beijing amid the global trade war.

What happened: The joint venture, called Fujian Sinopec Aramco Refining and Petrochemical Co, was formed by Sinopec; its subsidiary, Fujian Petroleum Chemical Industry Co; and Saudi Aramco's Singaporean unit, Aramco Asia Singapore Pte.(AAS), according to a statement from the Beijing-headquartered energy company that was issued Monday.

Sinopec and its subsidiary will contribute 7.2 billion yuan ($987 million) and 14.4 billion yuan ($1.97 billion) in cash, respectively, while the remaining 25% of the capital will come from AAS, the statement said.

The joint venture will engage in port operations, crude oil transportation and other activities at the refinery and petrochemical complex in the Gulei Port Economic Development Zone, Zhangzhou, in China’s Fujian province. Sinopec and Aramco began constructing the complex last November as part of the Saudi company's strategy to expand its downstream business outside the kingdom and to ship one million barrels per day of crude oil to China for oil-to-chemicals investments.