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Fri, Nov 15, 2024 | Jumada al-Awwal 13, 1446 | DXB
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Saudi Aramco closes $12.4b deal with consortium including Mubadala
Dubai - Aramco continues to hold a 51 per cent majority stake in the subsidiary and retains full ownership and operational control of its stabilised crude oil pipeline network.
Aramco Oil Pipelines will receive a tariff payable by Aramco for stabilised crude oil flows, backed by minimum volume commitments.
An international investor consortium including UAE sovereign wealth fund Mubadala Investment Co and Washington-based energy sector investor EIG has acquired a 49 per cent stake in Aramco Oil Pipelines Co., a unit of Saudi Aramco for $12.4 billion, the company said on Sunday.
As part of the transaction, first announced in April 2021, Aramco and its subsidiary entered into a 25-year leaseback agreement for the oil giant’s stabilised crude oil pipelines network.
Mubadala, which manages $243 billion in assets, didn’t disclose its stake size in a June 8 statement.
Aramco Oil Pipelines will receive a tariff payable by Aramco for stabilised crude oil flows, backed by minimum volume commitments.
Aramco continues to hold a 51 per cent majority stake in the subsidiary and retains full ownership and operational control of its stabilised crude oil pipeline network.
The transaction does not impose any restrictions on Aramco’s actual crude oil production volumes, which are subject to production decisions made by the kingdom.
“The interest we have received from investors shows strong confidence in our operations and the long-term outlook for our business,” Aramco president and CEO Amin H. Nasser said in a statement.
He said his company would continue to explore opportunities to capitalise on the industry-leading capabilities and attract the right type of investment to Saudi Arabia.
“We believe this is the marquee infrastructure transaction globally and we are pleased to see that so many leading international investors agree with us,” said R. Blair Thomas, EIG’s chairman and CEO.
According to S&P, Aramco’s pipeline asset sale is similar to transactions struck by Abu Dhabi National Oil Co. in the last two years. Adnoc inked in June 2020 a deal worth more than $10 billion with a group of investors to sell a 49 per cent stake in its gas pipelines a year after striking a similar transaction for its oil pipelines.
Adnoc also clinched a $5 billion deal in 2019, with a consortium that includes GIC, BlackRock Inc., KKR & Co and Abu Dhabi Retirement Pensions and Benefits Fund, to sell select pipeline infrastructure and collectively hold a 49 per cent stake in Adnoc Oil Pipelines, a subsidiary of the parent company.
— issacjohn@khaleejtimes.com
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