“There are talks now for the acquisition of a 1% stake by a leading global energy company in an important deal that would boost Aramco’s sales in … a major country,” international news services quoted him as saying on Saudi television.
The crown prince said nothing about which country was at issue.
He said that in the next two years the kingdom could also offer shares on secondary markets.
The company’s IPO took place a little over a year ago – in December 2019, Saudi Aramco offered 3 billion shares and raised $25.6 billion in the IPO and in January 2020 offered a further 450 million shares, raising $2.8 billion.
This year, Saudi Aramco signed an agreement with a consortium headed by U.S. firm EIG Energy Partners concerning the sale of 49 % of Aramco Oil Pipelines – its newly formed affiliate operating the company’s pipeline network in the kingdom.
That deal worth $12.4 billion will allow the consortium over 25 years to receive tariff payments for oil carried by the Aramco Oil Pipelines network, the consortium said.
By selling 49 % of its pipeline affiliate, Aramco may reduce losses incurred during the Covid crisis: in 2019, the company posted a net profit of $88.2 billion, while the 2020 figure stood at $49 billion. The decline was caused by a fall in the price of oil (in 2020, the average price of Middle Eastern Dubai crude plunged by a third to $42.10 a barrel, according to World Bank figures) and by production cuts as part of the OPEC+ agreement – in 2019, Saudi Arabia produced on average 9.8 million barrels per day, while in 2020 the figure stood at 9.21 million bpd, according to the International Energy Agency (IEA).
Despite the partial recovery on oil markets, the first quarter of 2021 was not an easy one for Saudi Aramco. That is apparent from the dynamics of Saudi Arabia’s sea exports of oil. These totalled 6.7 million bpd in December 2020, but dipped to 6.3 million bpd in January, according to data from Refinitiv. and stood at 5.5 million and 5.7 million in February and March.
This decline was largely linked to the kingdom’s decision to cut oil production in February and March by an additional 1 million bpd – a level that was later maintained in April.