What Can We Expect From a Saudi Aramco IPO?
Thursday February 4, 2016
Muhammad bin Salmon, the Kingdom of Saudi Arabia’s (KSA) Deputy Crown Prince, has publicly stated his personal support for selling shares to the public in Saudi Aramco.
Saudi Aramco Not likely To Include Petroleum Reserves In An IPO
Khalid al-Falih, the Saudi Aramco Chairman, stated at the Davos conference last month that any offering would not include the company’s oil reserves. Not including any reserve information in a public offering means that the number shown in the Organization of Petroleum Exporting Countries (OPEC) data will continue as the KSA’s official public estimate of its oil reserves.Any Saudi Aramco public listing appears likely to include downstream and some exploration and production assets in the company.
How Much Oil Does Saudi Arabia Own?
The official OPEC report states that at year end 2014 the KSA had proven crude oil reserves of 266.58 billion barrels. The Society of Petroleum Engineers defines “reserves” as “the quantities that remain to be commercially produced as of a given date, under stated economic and operating conditions.”
No Twilight In KSA Desert Anytime Soon
Matthew Simmons generated significant controversy with the publication of “Twilight in the Desert” in 2006. The book prompted significant global debate around the concept of Peak Oil – a debate which has largely been settled with the unconventional tight oil revolution that demonstrates the paradigm changing opportunity that best in class technology and practices has brought to the exploration and production of oil and gas.