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Aramco Signs Over $25 Billion of Deals for Main Gas Network, Jafurah Gas Field

This picture shows Aramco tower (C) at the King Abdullah Financial District (KAFD) in Riyadh on April 16, 2023. (AFP via Getty Images)
This picture shows Aramco tower (C) at the King Abdullah Financial District (KAFD) in Riyadh on April 16, 2023. (AFP via Getty Images)
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Aramco Signs Over $25 Billion of Deals for Main Gas Network, Jafurah Gas Field

This picture shows Aramco tower (C) at the King Abdullah Financial District (KAFD) in Riyadh on April 16, 2023. (AFP via Getty Images)
This picture shows Aramco tower (C) at the King Abdullah Financial District (KAFD) in Riyadh on April 16, 2023. (AFP via Getty Images)

Saudi Arabia's state oil company Aramco has signed contracts worth more than $25 billion for the second phase of the expansion of its Jafurah gas field and the third phase of expanding its main gas network, its CEO Amin Nasser said on Sunday.

Jafurah is the kingdom's largest unconventional non-oil associated gas field and is potentially the biggest shale gas development outside the United States, with reserves reaching 229 trillion cubic feet of gas and 75 billion barrels of condensates.

"By generating an anticipated 2 billion standard cubic feet per day of sales gas by 2030, this bold initiative will strengthen Saudi Arabia's position as one of the top national gas producers in the world", said Nasser, speaking of the Jafurah field at a contracts award ceremony in Dhahran.

The main gas network expansion will add 4,000 more kilometers of pipelines, boosting capacity by around 3.2 billion standard cubic feet per day and connecting several additional cities from across the country to the network, he said.

The awarded contracts are worth more than $25 billion, and will target sales gas production growth of more than 60% by 2030, compared to 2021 levels.

The contract awards "demonstrate our firm belief in the future of gas as an important energy source, as well as a vital feedstock for downstream industries. The scale of our ongoing investment at Jafurah and the expansion of our Master Gas System underscores our intention to further integrate and grow our gas business to meet anticipated rising demand," Nasser noted.

"This complements the diversification of our portfolio, creates new employment opportunities, and supports the Kingdom’s transition towards a lower-emission power grid, in which gas and renewables gradually displace liquids-based power generation. To get where we are today, a lot of hard work, innovation and a strong ‘can do’ spirit has been demonstrated by teams across our vast network of suppliers and service providers, who have joined Aramco on this journey to build and expand our world-class energy infrastructure,” he added.

According to Aramco, the Company has awarded 16 contracts, worth a combined total of around $12.4 billion, for phase two development at Jafurah. The work will involve construction of gas compression facilities and associated pipelines, expansion of the Jafurah Gas Plant including construction of gas processing trains, and utilities, sulfur and export facilities. It will also involve construction of the Company’s new Riyas Natural Gas Liquids (NGL) fractionation facilities in Jubail — including NGL fractionation trains, and utilities, storage and export facilities — to process NGL received from Jafurah.

Another 15 lump sum turnkey contracts, worth a combined total of around $8.8 billion, have been awarded to commence the phase three expansion of the Master Gas System, which delivers natural gas to customers across the Kingdom of Saudi Arabia. The expansion, being conducted in collaboration with the Ministry of Energy, will increase the size of the network and raise its total capacity by an additional 3.15 billion standard cubic feet per day (bscfd) by 2028, through the installation of around 4,000km of pipelines and 17 new gas compression trains.

An additional 23 gas rig contracts worth $2.4bn have also been awarded, along with two directional drilling contracts worth $612 million. Meanwhile, 13 well tie-in contracts at Jafurah, worth a total of $1.63bn, have been awarded between December 2022 and May 2024.

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Business

OPEC+ Approves Further Oil Output Increase

The logo of the Organization of Petroleum Exporting Countries (OPEC) is seen at its headquarters in Vienna on June 3, 2023. (AFP)
The logo of the Organization of Petroleum Exporting Countries (OPEC) is seen at its headquarters in Vienna on June 3, 2023. (AFP)
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OPEC+ Approves Further Oil Output Increase

The logo of the Organization of Petroleum Exporting Countries (OPEC) is seen at its headquarters in Vienna on June 3, 2023. (AFP)
The logo of the Organization of Petroleum Exporting Countries (OPEC) is seen at its headquarters in Vienna on June 3, 2023. (AFP)

OPEC+ has agreed a further increase in output targets from August, the group said in a statement on Sunday, adding to global supply at a time when oil prices are falling due to the gradual reopening of the Strait of Hormuz for oil exports.

The oil-producing group agreed during an online meeting to increase quotas by 188,000 barrels per day from August, on top of similar increases for June and July.

The seven core members of OPEC+, which groups OPEC and allied producers including Russia, have hiked their output quotas from April through July by almost ‌800,000 bpd.

OPEC+ output fell to 33.13 million bpd in May, according to OPEC data, from 42.77 million bpd in February.

Despite persisting supply disruptions, oil prices have returned to pre-war levels, pressured by lower Chinese imports, higher exports from ⁠non-Middle East producers, and a record global strategic stock release coordinated by ‌the International Energy Agency.

"The group of seven kept unwinding their ‌production cuts as widely expected," UBS analyst Giovanni Staunovo said. "The near-term focus will remain on how many tankers will ‌manage to cross the Strait of Hormuz and how quickly demand and Chinese crude imports recover."

A ‌memorandum of understanding between Washington and Tehran to end the war has also helped convince traders that supply will ultimately return to normal levels.

Brent crude prices traded near $72 per barrel on Friday, down from recent peaks of more than $120 per barrel and back to levels traded just before the US ‌and Israel attacked Iran on February 28.

Those seven producers — Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan and Oman — are boosting output as part of the phased rollback of a 1.65 million bpd supply cut agreed in 2023, when the group still included the UAE.

Business

Saudi Tourism Gains Momentum in Q1 as Licenses Rise and Workforce Nears One Million

A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)
A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)
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Saudi Tourism Gains Momentum in Q1 as Licenses Rise and Workforce Nears One Million

A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)
A view of a tourist resort in Al-Khobar, Saudi Arabia. (SPA)

The tourism and hospitality sector in Saudi Arabia showed strong operational dynamism and institutional expansion in the first quarter of 2026, according to official data from Saudi Arabia's General Authority for Statistics. Despite the freedom demonstrated in daily price levels and occupancy rates, the sector's regulatory environment saw extraordinary growth in licenses and an influx of both national and expatriate workers.

Indicators confirmed an increase in the total number of licensed tourism hospitality facilities in the Kingdom during Q1 2026 by 22.7 percent, reaching 6,122 facilities compared to 4,988 in the same quarter of 2025. Serviced apartments and other hospitality facilities accounted for the largest share, at 51.6 percent of the total, with 3,159, while the number of licensed hotels reached 2,963.

This facility expansion was paralleled by an increase in the number of establishments; the number of tourism establishments with employees in the Kingdom reached approximately 177,031 during Q1 2026, marking a 9.0 percent growth compared to the corresponding quarter of last year, which then recorded 162,473 establishments.

The total number of people employed in tourism activities saw a 6.5 percent year-on-year jump, increasing the sector's workforce to 1,047,313 employees compared to 983,253 in the same period of 2025.

According to the data, the number of Saudi employees in tourism activities reached 250,094, representing 23.9 percent of the total workforce, while non-Saudis numbered 797,219.

Conversely, the room occupancy rate in hotels decreased to 60.8 percent during Q1 2026, a decline of 2.2 percentage points compared to the same quarter of 2025, which recorded 63.0 percent.

In contrast, the serviced apartments and other hospitality facilities sector showed positive growth; its occupancy rate increased by 1.0 percent to reach 51.6 percent compared to 50.7 percent in the corresponding quarter in 2025.

At the price level, the average daily rate for a hotel room recorded an 11.4 percent decrease, reaching 423 Saudi Riyals compared to 477 Riyals in Q1 2025. The average daily rate in the serviced apartments and other hospitality facilities sector also saw a slight decrease of 1.2 percent, stabilizing at 206 Saudi Riyals compared to 209 Riyals.

Despite fluctuations in prices and occupancy, the Authority's statistics revealed a tangible improvement in the average length of guest stay:

In Hotels: The average length of stay increased by 2.0 percent, reaching 4.2 nights during Q1 2026 compared to 4.1 last year.

In Serviced Apartments: The length of stay increased by 1.2 percent, reaching 2.2 nights compared to 2.1 in the same quarter of 2025.

These aggregated data, which were compiled by the General Authority for Statistics using administrative records and secondary data, reflect an important phase of structural transformation in the Kingdom's tourism sector as it strives for operational solvency and relies on long-term, quality investments.

Business

Saudi Arabia’s Non-oil Private Sector Grows in June, New Orders at Four-month High

General view of the Saudi capital Riyadh (AFP)
General view of the Saudi capital Riyadh (AFP)
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Saudi Arabia’s Non-oil Private Sector Grows in June, New Orders at Four-month High

General view of the Saudi capital Riyadh (AFP)
General view of the Saudi capital Riyadh (AFP)

The latest Riyad Bank Purchasing Managers' Index (PMI), released on Sunday, showed that growth in Saudi Arabia's non-oil private sector accelerated markedly at the end of the second quarter.

The improvement was driven by the strongest increase in new orders and new business in four months, helping business activity regain strong momentum despite continued challenges from weak export demand and mounting inflationary pressures.

The seasonally adjusted headline index rose to 53.3 in June from 52.8 in May, remaining above the 50.0 threshold that separates growth from contraction and signaling a solid improvement in overall operating conditions and the domestic business environment.

Domestic demand rebounds

The report attributed the latest upturn to stronger inflows of new business and higher domestic spending, supported by companies securing approvals for new projects and the resumption of previously delayed sales activity as concerns over regional tensions eased. This helped bolster confidence among both investors and consumers across the kingdom.

The data showed sustained growth in output, with around 18% of surveyed firms reporting higher activity levels, while only 2% recorded a decline in output during June.

Commenting on the survey, Riyad Bank Chief Economist Naif Alghaith said: "Strong output growth, alongside the fastest increase in new orders in four months, indicates that business activity regained positive momentum at the end of the second quarter. These results once again demonstrate the resilience of the domestic economy and the non-oil sector's ability to provide a solid foundation for the kingdom's broader economic growth."

Alghaith added, highlighting companies' operating strategies: "Operationally, firms maintained strict discipline, with employment levels broadly unchanged, while backlogs of work declined for the first time in a year. This suggests companies were able to absorb rising workloads without creating capacity constraints, while prioritizing operational efficiency and measured expansion."

Exports weaken

On the other hand, the report said the rebound in the domestic market contrasted with export performance, as new orders from overseas clients declined for a fourth consecutive month, weighed down by regional logistical disruptions and intensifying competition in external markets.

Price pressures also remained the biggest challenge facing businesses. Input costs recorded their strongest quarterly increase in 15 years, driven by higher fuel, freight and wage costs. The sustained cost pressures prompted around 22% of surveyed firms to raise prices for their goods and services, resulting in the second-fastest increase in output charges in nearly six years.

Alghaith commented on how firms are managing these challenges, saying: "Despite continued cost pressures, companies appear able to manage them prudently without materially affecting overall optimism or the level of activity. This in turn reflects the underlying resilience of businesses and their strong ability to strike a careful balance between maintaining profitability and pursuing sustainable expansion in the market."