Saudi Aramco prepares for global expansion as IPO looms

Brand logo of Aramco

Saudi Arabia’s state-owned oil giant Aramco is seeking to expand globally via joint ventures overseas as it prepares for a partial privatization pushed by a government intent on diversifying the economy.

The company is looking at opportunities in the United States, India, Indonesia, Vietnam and China, chief executive Amin Nasser told reporters during a rare media visit to the company’s Dhahran headquarters.

“We are looking at the current market status that, even though challenging, is an excellent opportunity for growth,” Nasser said, adding that he believed an extra 1.2 million barrels per day would be added to global oil demand this year.

Changes to Saudi Aramco lie at the heart of plans for a radical overhaul of the kingdom’s economy and energy sector to meet the challenge of expected lower oil prices that have already caused massive fiscal deficits in Riyadh.

Saudi Arabia is expected to sell up to five percent of Aramco via an initial public offering (IPO) and has asked the company to play a big role in developing industrial projects aimed at diversifying the energy-centred economy.

“We will meet the call on Saudi Aramco,” Nasser said, adding that the company produced an average of 10.2 million bpd of crude in 2015 and that the latest stage of its expansion project at the southeastern Shaybah oil field would be finished “in a couple of weeks”.

The increased capacity of 250,000 bpd, taking Shaybah’s total production capacity to 1 million bpd, is aimed at rebalancing Saudi Arabia’s crude oil quality and at compensating for falling output at other fields as they mature, he said.

Saudi Aramco also expects a huge ship repair and shipbuilding complex that it is developing at Ras al-Khair on the kingdom’s east coast to be fully operational by 2021, Nasser said.

The first part of the shipbuilding complex, part of Riyadh’s plans to boost industrial diversification, will be ready by 2018, and it will eventually make oil rigs and tankers, Nasser said.

A presentation by the company showed the complex would create 80,000 jobs and allow Saudi Arabia to reduce its imports by $12 billion, while increasing the country’s gross domestic product by $17 billion.

Also read:

Less than 5 per cent of Aramco to be sold: Saudi deputy crown prince

Saudi Arabia explores dual listing, traded fund for Aramco IPO

Saudi Aramco, Shell plan to break up Motiva, divide up assets

Reuters

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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