Saudi Deputy Crown Prince says kingdom considering Aramco IPO

Saudi Arabia is considering listing shares of Saudi Aramco, the world’s biggest oil producer, the kingdom’s Deputy Crown Prince Mohammed bin Salman told The Economist in an interview.

Salman said the decision on Aramco’s initial public offering will be taken in the next few months. A sale of shares would serve Saudi Arabia and Aramco’s interests and promote transparency, he told The Economist.

“Personally, I’m enthusiastic about this step,” Salman said.

The potential listing comes as Saudi Arabia grapples with the damage wreaked on its economy by an oil-price collapse to below $35 a barrel, as well as mounting tensions with its arch-rival Iran, following the execution of Saudi cleric Nimr Baqr al-Nimr in early January, The Economist said, adding that tt is just one possible step in an ambitious plan to balance the budget and throw open the country’s closed economy.

Saudi Aramco produces all of Saudi Arabia’s crude oil, which was pegged at 10.25 million barrels a day in December.

Officials say Saudi Aramco is worth “trillions of dollars”, but it is one of the world’s most secretive oil companies and reveals no information on revenues and offers only limited information on its hydrocarbon reserves, The Economist said.

The newspaper reported diplomats as saying that investors were already being sounded out. The talk is of first floating part of the company in Riyadh—perhaps 5 percent.

The upstream part of the business would be most attractive to investors. At 261 billion barrels, Saudi Aramco’s stated hydrocarbon reserves are more than ten times those of ExxonMobil, the largest private oil company, it reported.

 

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