Saudi Aramco CEO: SABIC acquisition perfect for our ‘crude to chemical’ strategy
Saudi Aramco’s proposed acquisition of 70 percent in Saudi Basic Industries Corporation (SABIC) is perfectly suited to its strategy of transforming crude into chemical with the objective of becoming leading energy and chemical company globally, CEO Amin Nasser has said.
“Chemical has been an area of interest for us since we started Accelerated Transformation Program in 2011. We have a lot of integrated facilities for chemical globally,” Nasser told Bloomberg on the sidelines of the ongoing World Economic Forum in Davos.
“Our strategy is to take 2-3 million barrels of our crude and transform that to chemical. Each million barrel is about 40 million tons, which is a huge amount of chemical,” he said.
Nasser said that this is in Saudi Aramco’s best interest as it realized that organic growth isn’t going to allow it to meet its aspirations of being the leading petrochemical company in time.
“There is a lot of integration potential with SABIC. It is next door, most of their feedstock come from Saudi Aramco, we have a lot of opportunities, it is an excellent company, it has major footprint in 50 countries, it is an excellent platform for investment,” he said.
Nasser said Saudi Aramco is currently in discussion with the Public Investment Fund (PIF) for the acquisition of 70 percent of the share of SABIC and the price of acquisition is yet to be finalized.
On the financing of the potential acquisition, Nasser said the company is exploring all options one of which is bond issuance. He also said that natural gas is a very important strategy for Saudi Aramco.
“Today, we are a major producer of gas but most of it is used domestically. Today, 55 percent utility in the Kingdom is on gas and we are looking to shift that to 75 percent by 2030,” he said.