Saudi Aramco, the biggest energy company, outlined financing plans on Wednesday that will support its expansion into new areas under a sweeping economic reform plan released by Riyadh this week.
The reforms envisage Aramco transforming itself from an oil and gas firm into a “global industrial conglomerate” involved in many sectors and services, using its vast financial resources to create jobs and help diversify the Saudi economy beyond oil.
“We will continue to build on our accelerated transformation and serve as a pillar, role model and champion of transformation in the Kingdom,” Aramco’s official magazine, Arabian Sun, quoted chief executive Amin Nasser as saying.
Aramco’s board, which met in Tokyo last week, decided to provide interim financing for a planned shipyard at the town of Ras Al-Khair on Saudi Arabia’s east coast, the magazine said without giving details.
In January, Aramco signed an MoU to establish the shipbuilding and repair complex with National Shipping Co. of Saudi Arabia (Bahri), a subsidiary of Lamprell Plc, a UAE-based engineering firm, and South Korea’s Hyundai Heavy Industries.
Aramco’s board also decided to set up joint ventures for onshore and offshore drilling rig services, the magazine said without giving details of those ventures.
Aramco wants to control more of those businesses to create jobs for Saudis, stimulate local demand and control costs. The board approved an additional equity contribution for its Sadara petrochemical joint venture with US firm Dow Chemical, Arabian Sun said.
Aramco also approved the creation of a program to issue Islamic bonds (sukuk), the magazine added.
Aramco officials welcomed the IPO plan as a way to participate in the reform program. Also announced on Wednesday were several appointments to senior posts in Aramco, including four people to the level of vice president.
Nabeel Al-Mansour was appointed general counsel, the first Saudi to hold that post. One goal of the reform program is to move local citizens into jobs, both senior and junior.
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