Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Riyadh Mulls Partial Saudi Aramco Sale

HOUSTON -- Saudi Arabia is looking at the possibility of privatizing some of the operations of state-owned Saudi Aramco, the biggest oil-producing company in the world, Saudi Oil Minister Ali al-Naimi said Saturday.

He also said Saudi Arabia's Oil Ministry was in the process of establishing a publicly owned energy services company.

The disclosures came in a speech to Saudi Aramco employees and Saudi Crown Prince Abdullah, who was in Houston last week after talks about the Israeli-Palestinian crisis with U.S. President George W. Bush at his Crawford, Texas ranch.

Naimi said Saudi Aramco currently outsources many support services to the Saudi private sector to help spread the wealth generated by its oil production.

"We in the Oil Ministry are embarking on establishing a publicly owned company that will provide support services to the petroleum and energy sector,'' he said in a copy of the speech.

"This covers engineering, seismic surveying, drilling, manufacturing of some products and others,'' Naimi said.

"We are also studying the possibility of privatizing some of Saudi Aramco's operations,'' he said, without giving further details.

Saudi Aramco was a joint venture with private oil companies until the 1980s, when the Saudi government acquired a 100 percent interest in its assets, according to a company profile.

Now, "it ranks first among oil companies worldwide in terms of crude oil production and exports and natural gas liquids exports and is among the leading producers of natural gas,'' the profile said.

In his speech Naimi said: "Today, the production capacity of the kingdom is more than 10 million barrels oil per day and its reserves are 262 billion barrels, representing 25 percent of world reserves.

"And its share of global production is 12 percent.''

Crown Prince Abdullah, the de facto leader of Saudi Arabia, met with Bush on Thursday in five hours of talks in which he was said to have urged Bush to moderate his support for Israel to help ease the latest cycle of violence in the Middle East.

News reports ahead of the meeting suggested the Saudis were considering the use of oil as a weapon to influence U.S. policy. The Saudis have emphatically denied the reports.

Naimi appeared to underscore the denials in his speech.

"The economic and political relations that bind the U.S. and Saudi Arabia and those that bind the Saudi petroleum industry and its American counterparts, especially Texas, are strong,'' he said.

"And our hope is that these relations continue to develop for the betterment of both sides. And that Saudi-American ties are not affected by those who might try to disrupt this relationship,'' Naimi said.

In a comment directed to the prince, Naimi said he prayed "to God that he helps you achieve a just peace in the Middle East."