Saudi Arabia to restore full oil production by next week
LONDON: Saudi Arabia has restored more than 75% of crude output lost after attacks on its facilities and will return to full volumes by early next week, a person briefed on the latest developments told Reuters on Monday.
Saudi’s oil production from its Khurais plant is now at more than 1.3 million barrels per day, while current production from its Abqaiq plant is at about 3 million bpd, the person said.
The September 14 attacks on the Abqaiq and Khurais plants, some of the kingdom’s biggest, caused raging fires and significant damage that halved the crude output of the world’s top oil exporter, by shutting down 5.7 million barrels per day of production.
Saudi Energy Minister Prince Abdulaziz bin Salman and the chief executive of state oil company Aramco, Amin Nasser, have said the output will be fully back online by the end of September. The kingdom has managed to recover supplies to customers to the levels they were at prior to the attacks by drawing from its huge oil inventories and offering other crude grades from other fields, Saudi officials said.
No casualties were reported at the sites even though thousands of workers and contractors work and live in the area.
Saudi said it would ensure full oil supply commitments to its customers. The kingdom ships more than 7 million bpd to global destinations every day, and for years has served as the supplier of last resort to markets.
Saudi Arabia’s ability to quickly restore oil production after the attacks, which hit at the heart of the Saudi energy industry and intensified a decades-long struggle with arch-rival Iran, would demonstrate an important degree of resilience to potentially very damaging shocks, Moody’s said last week.
SAUDI ARAMCO IPO
Meanwhile Saudi Aramco is plowing ahead with preparations for its blockbuster initial public offering, with a string of banker meetings scheduled this week after it added more than a dozen junior underwriters to the deal, people with knowledge of the matter said. IPO underwriters will hold two days of analyst presentations with their banks’ research teams starting September 25 near Aramco’s headquarters in Saudi Arabia’s Eastern Province, according to the people. The senior banks on the IPO are meeting now to prepare, one of the people said, asking not to be identified because the information is private.
Executives from the newly-appointed bookrunners on the deal were also flying to the Middle East over the weekend for meetings with Aramco starting Monday, according to the people. Bankers have been working around the clock on the IPO since being hired, with the aim of having everything ready for Aramco to list as soon as November if the company decides to proceed, the people said. Aramco has already started out informally sounding out potential investors to gauge their interest, the people said. It is still discussing a potential IPO valuation of at least $2 trillion with the arrangers, though it wasn’t yet clear whether Aramco will be able to achieve the target, the people said.