Saudi Aramco's Chief Executive Amin Nasser revealed that the company has completed its purchase of a 70 percent stake in petrochemicals company Saudi Basic Industries Corp (SABIC) as part of its downstream strategy.
The strategy is linked to factors including climate change and the need to find sustainable markets for demand, especially in the petrochemical sector, Nasser noted.
He told Asharq Al-Awsat that the executed deal will provide opportunities to promote harmonization and complementarity between the Saudi Aramco outputs of hydrocarbons that are used at SABIC factories to produce petrochemicals.
This leads to generating growth opportunities and achieving the highest possible value of each barrel produced by Aramco.
Nasser added in the answers received by Asharq Al-Awsat that it is important to look at this acquisition deal on a long-term basis.
The largest percentage of oil use today - according to Nasser - takes place in the transport sector, whether land, sea or air, which, with the growing climate change challenge, is forced to tap into markets outside the transport sector.
The petrochemical sector, on the other hand, is promising.
Nasser, in press statements, had expressed that Saudi Aramco will use cash and debt to pay its dividend of $18.75 billion for the first quarter of this year.
“It will be a combination of both,” Nasser told reporters on a conference call.
“We would like to use our free cash definitely most of time, but other debt instruments from banks or bonds are also available for us as we have a strong balance sheet,” he said.
Nasser was speaking a day after Aramco completed its purchase of a 70 percent stake in SABIC from Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), for $69.1 billion and extended the payment period by three years to 2028.
