Aramco IPO by 2021 — Saudi Crown Prince
KINGDOM EXPORTS TWO BARRELS OF OIL FOR SINGLE ONE LOST TO IRAN SANCTIONS, HE SAYS
$35b of cash and assets have been transferred to government from anti-corruption campaign, he says |
Saudi Arabia’s Crown Prince insisted the stalled plan to sell shares in oil giant Aramco will go ahead, promising an initial public offering by 2021 and sticking to his ambitious view the staterun company is worth $2 trillion or more, Bloomberg reported yesterday.
“I believe late 2020, early 2021,” Prince Mohammad Bin Salman said, discussing the timing of the IPO in an interview with Bloomberg at the royal palace in Riyadh. “The investor will decide the price on the day. I believe it will be above $2 trillion. Because it will be huge.”
For the past two years, Saudi Arabia has prepared to place up to 5 per cent of its national oil company on the stock market.
The planned listing of the world’s biggest oil producer was to be the cornerstone of the kingdom’s promised economic overhaul and, at a targeted $100 billion, the biggest IPO ever.
Prince Mohammad said in the Bloomberg interview that the Saudi government will keep the shares of Aramco after the IPO, rather than transfer them into the sovereign wealth fund as originally planned.
Instead, the public investment fund (PIF) will receive the $70 billion from the sale of its stake in Sabic, plus the $100 billion that country hopes to raise from the Aramco IPO, the report said.
Prince Mohammad provided a detailed timetable of his plans for Aramco, saying that after the deal with local petrochemical giant Sabic is completed in 2019, the company would need a full financial year before it can go ahead and sell shares to the public, the report said.
Oil prices
Saudi Arabia’s crown prince, facing US pressure to tame surging oil prices, insisted that the kingdom is fulfilling promises to make up for Iranian crude supplies lost to American sanctions. “The request that America made to Saudi Arabia and other Opec countries is to be sure that if there is any loss of supply from Iran, that we will supply that,” he said. “And that happened.”
The Saudis’ efforts have also failed to prevent crude hitting a four-year high above $86 a barrel in London this week.
Oil traders are concerned that the kingdom isn’t ramping up quickly enough, and that it may not have enough capacity to fully cover Iran’s losses. Yet a coalition of producers from Opec and beyond has recently boosted output by 1.5 million barrels a day, double the 700,000-barrel decline suffered so far by Iran, according to the crown prince.
“We export as much as two barrels for any barrel that disappeared from Iran recently,” Prince Mohammad said. “So we did our job and more.”
Saudi Arabia is now pumping about 10.7 million barrels a day — close to a record — and can add a further 1.3 million “if the market needs that,” the prince said.
I love working with him [Trump]. You know, you have to accept that any friend will say good things and bad things.”
Prince Mohammad Bin Salman
Anti-corruption campaign
Eight people detained in Saudi Arabia’s anti-corruption campaign remain in custody, the kingdom’s crown prince said in the interview published yesterday, after scores were arrested in a purge launched last November.
Prince Mohammad said $35 billion, split between 40 per cent cash and 60 per cent assets, had been transferred to the government. “We think it will complete in the next maybe two years,” he added.