Saudi Aramco, the state-controlled oil company of Saudi Arabia, is in talks with French energy firm TotalEnergies SE and Chinese oil giant Sinopec to invest in the Jafurah gas development. The gas field is one of the largest untapped reserves in the world, and Aramco is seeking equity investors to help fund midstream and downstream projects. The plans include constructing facilities for exporting the gas as liquefied natural gas (LNG). The company is aiming to raise around $10 billion for the project, according to sources.
The Jafurah gas development is a key part of Saudi Arabia's strategy to diversify its exports beyond oil. The field is estimated to hold 200 trillion cubic feet of gas, and Aramco expects to begin production in 2025, reaching sales of about 2 billion standard cubic feet per day by 2030. The decision to build an LNG export terminal marks a departure from Aramco's recent statements that the majority of the gas from Jafurah and other fields would be used for the domestic market and to make blue hydrogen.
Since Aramco was fully nationalized in 1980, foreign investment in the kingdom's energy industry has been restricted to downstream assets such as refineries and petrochemical plants. However, the company has struck joint ventures with firms such as Shell Plc and TotalEnergies in the past for natural gas exploration and drilling within Saudi Arabia's borders.
The talks with TotalEnergies and Sinopec are ongoing, and no final decisions have been made yet. In addition to seeking private equity firms and large funds that invest in infrastructure, Aramco is also offering stakes in assets such as carbon capture and storage projects, pipelines, and hydrogen plants. Investment bank Evercore Inc. is advising Aramco on the plans.