Saudi Aramco is reportedly nearing an agreement to secure approximately $10bn (SR37.5bn) from a consortium spearheaded by BlackRock towards infrastructure for its Jafurah gas project, reported Reuters, citing sources.
This deal is part of a strategy by Gulf oil producers to raise capital for economic diversification while offering investors reliable revenue.
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The Jafurah project, valued at $100bn, is potentially the largest shale gas initiative outside of the US.
This deal is crucial to Aramco’s goal of significantly increasing its gas production capacity by 60% by 2030 compared with 2021 production levels. The assets involved in the potential deal encompass gas pipelines and a processing plant.
The transaction is expected to mirror the structure of two previous Aramco infrastructure deals from 2021, which included a BlackRock investment in Aramco’s gas pipeline networks.
In 2021, investment groups including BlackRock and EIG acquired stakes in Aramco’s pipeline subsidiaries, Aramco Oil Pipelines and Aramco Gas Pipelines, through leaseback transactions.
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By GlobalDataAramco retained majority ownership and the subsidiaries received tariffs backed by minimum throughput commitments, raising nearly $28bn for the company.
These arrangements allowed Aramco to raise funds while maintaining control over the assets and providing investors with tariffs for pipeline usage.
These transactions followed similar deals in the region, such as ADNOC’s sale of minority stakes in its oil and gas pipeline leasing companies.
Saudi Arabia has been actively seeking to diversify its economy in light of fluctuating oil prices and global economic uncertainties that threaten demand.
Other challenges include increased oil output from OPEC countries, including Saudi Arabia, which aims to capture a larger market share.
Furthermore, in March, Aramco announced its expansion into South America with the acquisition of Primax, a fuel distributor operating in Peru, Colombia and Ecuador, for approximately $3.5bn.
