Saudi Aramco’s IPO to affect downstream operations only

According to media sources, Saudi Arabia is planning to sell shares of Aramco’s joint refining ventures with foreign firms in Saudi Arabia and abroad while not offering any shares in the company’s primary crude oil exploration and extraction branch. Previously, Saudi Arabia’s Deputy Crown Prince Mohammed Bin Salman had stated that the country was reviewing the possibility of an initial public offering of state-owned Saudi Aramco’s shares, adding that a decision was expected to be made in the next few months.

A holding company to gather together Aramco’s stakes in its downstream subsidiaries may be established and listed for initial public offering in the stock market, though foreign partners of the Saudi oil giant have not been informed of the idea yet. Meanwhile, analysts commented that legal actions necessary to offer shares to the public could take several months to complete.

Analysts report that the government is considering the sale in order to expand the economy beyond crude oil production and enhance the role of the private sector.