Saudi Aramco Set To Disclose Accounts, Oil Reserves In Planned Bond Sale

Saudi Aramco is getting ready to issue a bond in the second quarter of 2019 to help it finance the acquisition of a majority stake in petrochemical giant Sabic, and this debt issue would force Saudi Arabia’s state oil firm to disclose its financials and oil reserves for the first time in decades, Bloomberg reports.

Aramco’s bond sale will probably be in U.S. dollars, Bloomberg quoted Saudi Energy Minister Khalid al-Falih as saying at a presentation of the plan in Riyadh.

“We will work with our advisers and find the right time to go to market and part of that would be a prospectus that would have appropriate financial statements and disclosures,” al-Falih said, commenting on the plans for the bond sale.

Saudi Aramco—whose initial public offering (IPO) touted for 2018 is now all but scrapped—plans to buy 70 percent in Sabic currently in the hands of the Public Investment Fund (PIF) of Saudi Arabia in a deal expected to be worth US$70 billion.

Aramco’s acquisition of a majority stake in Sabic would be key to the oil giant’s strategy to expand in the downstream segment and curb emissions, Aramco’s chief executive Amin Nasser told the Financial Times in September.  

Reports of how Aramco plans to finance the acquisition of the majority stake in Sabic started to circulate in October last year, with some reports saying that Aramco may borrow US$50 billion from international banks to finance that deal.

The most recent market rumors have had it that Aramco could fund the entire US$70-billion price tag for buying 70 percent in Sabic with the upcoming bond issue. Al-Falih, however, dismissed that chatter saying that “It’s not going to be anywhere near the number that’s been rumored.”

The Saudi energy minister also confirmed the date that the Kingdom has been giving lately for Aramco’s IPO to finally take place—2021.

By Tsvetana Paraskova for Oilprice.com

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