Monday, May 10, 2021

$ 12.4 billion deal for Saudi Aramco pipelines with EIG consortium

Saudi Aramco has signed a deal with a consortium led by EIG Global Energy Partners (AIG), with investment returns estimated at $ 12.4 billion.

Under the deal, a recently established Saudi Aramco subsidiary, the Aramco Crude Oil Supply Company, will lease the rights to use Saudi Aramco’s concentrated crude oil pipeline network for a period of 25 years.

Aramco will control 51% of the new company, while the consortium led by EIG will retain a 49% stake. Aramco will retain full ownership of the pipeline network with operational control.

According to the agreement, the deal will not impose any restrictions on the company in terms of the amount of actual production of crude oil, which is subject to the production decisions made by the state, and in return, Aramco Crude Oil Supply Company will receive a tariff paid from Saudi Aramco for the quantities of concentrated crude oil that flow through The network and that tariff is linked to a minimum volume of these quantities.

Saudi Aramco’s president and chief executive officer, Eng. Amin Al-Nasser said the deal would strengthen the company’s capital structure and maximize shareholder returns.

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