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August 17, 2021updated 26 Oct 2021 10:35am

Saudi Aramco seeks to raise $17bn from stake sale in gas pipeline

Aramco is working together with investment banking firms to seek potential buyers.

By Archana Rani

Saudi Aramco is reportedly considering selling a minority stake in its gas pipeline to raise at least $17bn.

The value of the potential deal will be higher than the $12.4bn raised from the sale of a 49% stake in Aramco Oil Pipelines to EIG Global Energy Partners-led consortium in June 2021.

Aramco is working together with investment banking firms JPMorgan and Goldman Sachs to seek potential buyers for the pipeline asset, reported Reuters, citing sources familiar with the matter.

Potential bidders for the Aramco stake sale include North American private equity and infrastructure funds, and companies that participated in the stake sale process of Abu Dhabi National Oil Co’s gas pipelines.

Firms showing interest in the sale include Chinese state-backed investment fund CNIC, China’s Silk Road, South Korea’s Korean Investment Corp (KIC) and NH Investment & Securities.

Sources were cited by the news agency as saying that the Middle Eastern firm intends to launch a formal sale process in the coming weeks.

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One source said that the potential deal may include equity of $3.5bn, with the remainder being bank debt.

Another source said the deal could be worth $20bn.

One source familiar with the deal told the news agency: “The gas deal is about the long-term view of gas utilisation and consumption in Saudi Arabia.”

In the Middle East region, United Oil & Gas has announced the commencement of drilling at the ASX-1X exploration well in the Abu Sennan Licence in Egypt.

ASX-1X is located some 7km north of the producing Al Jahraa field. The well was spudded on 14 August. The drill programme is expected to last for up to 54 days.

The licence is operated by Kuwait Energy Egypt (25%). Other partners include United Oil & Gas (22%), Global Connect (25%) and Dover Investments (28%).

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