Saudi Arabia’s oil giant Aramco is close to a deal to take a stake in the new combustion engine joint venture set up by automakers Renault SA and Zhejiang Geely Holding Group Co., sources familiar with the matter told Bloomberg.

According to the sources, Aramco, the world’s largest oil company, will take a minority stake in this joint venture, while Renault and Chinese manufacturer Geely intend to have an identical stake. Even if it is possible that a preliminary agreement will be announced as early as this week, there is no certainty that an agreement will be reached, the sources added, according to Agerpres.

A possible deal would help state-owned Aramco grow in an auto industry currently transitioning to battery-based power. Even though sales of all-electric vehicles have exploded in percentage terms, cars with combustion engines as well as hybrids will be in high demand for several years, especially in developing countries.

In May 2022, Renault had officially announced that it was considering the option of creating two separate entities, one dedicated to the development, production and sale of electric vehicles, based in France, and the other dedicated to the development and production of thermal engines and gearboxes and new generation E-TECH hybrids, which will include operations in Romania, Spain, Portugal, Turkey and Latin America. In November, Renault and Geely reached an agreement to launch a joint venture, equally owned, which will supply combustion engines and hybrid technology to the brands they own, as well as to other car companies.

The new entity, which does not yet have an official name, will have 19,000 employees at 17 factories and three research and development centers in Europe, China and South America.