Saudi Aramco and French oil major Total have agreed to invest $9.6 billion to build the 400,000 barrels per day Jubail refinery in Saudi Arabia, a source familiar with the situation said on Thursday.

'The SATORP board met in Paris on June 16 and decided to attribute the 13 remaining packages (out of 15) to build the Jubail refinery at a cost of $9.6 billion,' the source said.

SATORP is a joint venture between Saudi Aramco and Total in which Aramco has a 62.5 percent stake, and Total 37.5 percent.

'It is important to note that we are below the $10 billion level,' the source said, giving no further details.

The original estimated cost of the refinery had been pegged as high as $12 billion when commodity prices were near their peak last year. But Aramco and Total delayed their investment decision to take advantage of the slide in prices for raw materials to renegotiate the cost of the contracts.

In March, Jean-Jacques Mosconi, head of strategy at Total, said Total and Aramco wanted to keep the cost under $10 billion, and that $8 billion would be a 'good number.'    

In a statement that gave no investment amount, Aramco confirmed the refinery would be operational in the second half of 2013, and said it would offer 25 percent of the JV to the Saudi public in the fourth quarter of 2010, leaving both Aramco and Total with an equal 37.5 percent share in the plant.

Industry sources have said France's Technip, South Korea's Samsung Engineering, and Tecnicas Reunidas of Spain were among the final runners to win some of the packages. -Reuters