Aug 20, 2019

Report: Saudi Aramco selects advisers for its IPO revival

The Saudi Aramco oil field complex facilities at Shaybah in the Rub' al Khali. Photo: Reza/Getty Images

Saudi Aramco is selecting advisers to try to move forward on its on-again, off-again, on-again plans for a mammoth IPO, Bloomberg reports.

Why it matters: The listing of a slice of Aramco could be the largest IPO in history, and the proceeds are meant to help fund the kingdom's plans to diversify its crude-dominated economy.

  • Saudi officials have said they're looking to hold the IPO in 2020 or 2021 after shelving what had been plans for an offering in the 2018 timeframe.
  • "Saudi Aramco has picked Lazard Ltd. and Moelis & Co. to advise on the oil giant's second attempt at the world’s largest initial public offering," they report, citing unnamed people with knowledge of the matter.

But, but, but: All kinds of questions remain about the plans first announced in 2016, including the listing venue and Aramco's ability to hit anything close to their hoped-for $2 trillion valuation.

Meanwhile, Reuters has an interesting new piece this morning about how global warming could create hurdles for Saudi Aramco's plan to list 5% of the company, which the kingdom hopes will bring in up to $100 billion.

The big picture: "[S]ome investors and lawyers say the window to execute a sale at a juicy price is shrinking and Aramco will need to explain to prospective shareholders how it plans to profit in a lower-carbon world," they report.

The intrigue: The Saudis argue that their oil is well-positioned even in an increasingly carbon-conscious world because their emissions per extracted barrel are lower than other big producers.

Go deeper: Saudi Arabia touts its crude oil CO2 edge

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Saudi Aramco replaces chairman as oil giant prepares for massive IPO

Saudi Arabian Energy Minister Khalid al-Falih. Photo: Alexander Nemenov/AFP/Getty Images

There's new evidence that Saudi Arabia is serious about moving ahead with a mammoth IPO of shares in state oil giant Aramco after years of delays and uncertainty.

Driving the news: Energy Minister Khalid al-Falih will be replaced as chairman of Aramco by Yasir al-Rumayyan, head of the kingdom's sovereign wealth fund.

Go deeperArrowSep 3, 2019

Saudi oil sites hit by drone strikes: U.S. blames Iran

Smoke billowing from an Aramco oil facility following the Houthi attacks. Photo: AFP/Getty Images

Iran denied Sunday U.S. accusations that it was behind drone attacks targeting the world's largest oil processing facility at Abqaiq and a major oil field at Khurais in Saudi Arabia the previous day.

The latest: Yemen's Iranian-backed Houthi rebels claimed responsibility for the early Saturday strikes, AP reports. But U.S. Secretary of State Mike Pompeo blamed Iran, saying "there is no evidence the attacks came from Yemen." Iranian Foreign Ministry spokesperson Abbas Mousavi said in a statement the U.S. accusations were "blind, incomprehensible and meaningless."

Go deeperArrowUpdated Sep 15, 2019

Oil price spikes expected after attacks on Saudi facilities

Smoke billows from an Aramco oil facility. Drone attacks sparked fires at two Saudi Aramco oil facilities. Photo: AFP/Getty Images

Crude oil prices are expected to surge when Asian markets reopen Sunday night (U.S. time) as traders respond to Saturday's attacks against major oil processing and production sites in Saudi Arabia.

Why it matters: The alleged drone strikes, which took large volumes of production offline, are stark evidence of security risks facing OPEC's largest producer and the world's largest crude oil exporter.

Go deeperArrowSep 15, 2019