Page 10 - Downstream Monitor - MEA Week 35

DMEA ComPanies DMEA
Al-Falih replaced as Aramco chair ahead of IPO
miDDLe east
KHALID al-Falih has been replaced as chairman of Saudi Aramco by the head of the Public Invest- ment Fund (PIF), Yasir Al-Rumayyan.
The move was reported by Bloomberg on September 2, with Al-Falih appearing to con- firm the news on Twitter later that day, saying: “I congratulate my brother His Excellency Mr. Yasser Othman Al-Rumayyan,” noting that it was “an important step to prepare the company for thepublicoffering,wishinghimeverysuccess.”
Al-Rumayyan was already an Aramco board member.
His close relationship with Saudi Crown Prince Mohammed Bin Salman (MBS) is seen as having been instrumental in the move. Riyadh intends to to separate Aramco from the Ministry of Energy in order to avoid conflicts of interest.
Both moves are seen to be indicative of MBS’ dissatisfaction with progress in laying the ground for the Aramco IPO, the success of which is thought to be a personal issue for the Crown Prince.
The price eventually achieved for the 5% of shares in Aramco that will be made available
is expected to give the firm a total valuation of around $1.5tn, though MBS has previously said he anticipates the firm being valued at $2tn. The proceeds from the Aramco listing are due to go to the PIF.
In March, Aramco bought a majority stake in petrochemicals counterpart Saudi Basic Indus- tries Corp. (SABIC) from PIF in a deal valued at $69.1bn. The remainder of the stock remains traded on the local Tadawul Stock Exchange, with a joint statement by Aramco and SABIC formally disavowing any intent by the oil com- pany to further increase its holding.
Al-Falih’s profile had already suffered a major blow by the announcement on August 30 that Riyadh would split the Ministry of Energy, Industry and Mining portfolio into two separate ministries, stripping his responsibility for indus- try and mining. He does, however, retain his role as the head of energy policy.
The Ministry of Industry and Mining will be headed up by Bandar Alkhorayef, chairman of Abdullah Ibrahim Alkhorayef & Sons and head of printing firm Alkhorayef Printing Solutions.™
KNPC to begin diesel production at Mina Abdullah
miDDLe east
KUwAIT National Petroleum Corp. (KNPC) has announced that it will soon begin com- missioning of the diesel production unit at the 454,000 barrel per day Mina Abdullah refinery.
The firm, the downstream arm of Kuwait Petroleum Corp. (KPC) made the announce- ment in a tweet on September 2.
KNPC operates the country’s two existing refineries at Mina Abdullah and Mina al-Ah- madi, which are in the process of being upgraded and expanded to a combined capacity of 800,000 bpd under the so-called Clean Fuels Project (CFP). Mina Abdullah is located around 60 km south of Kuwait City.
In August, the government approved plans to build 11 storage tanks for petroleum prod- ucts under a project to expand existing storage capabilities at Matla in the Northern Jahra gov- ernorate. The project is part of efforts to expand existing storage facilities in Matla, where there are already 7 tanks.
Comments in Arabic to Kuwaiti daily Alseyassah were translated by Thomson Reu- ters: “KNPC has received land for the project and is in the process of preparing engineering designs ... the project has been approved by the
company’s board and tenders will be issued once it is approved by the Kuwait Petroleum Corp.”
KNPC marketing manager walid Al-Buai- jan said that the project cost is estimated at KwD66mn ($218mn) and comes as the country is increasingly focusing on its domestic down- stream sector.
The headline plans focus on the intention to more than double refining capacity from the 936,000 barrel per day rate it could achieve when the programme was conceived. The 200,000 bpd Shuaiba facility was closed in March 2017; nev- ertheless, downstream-focused KNPC aims to reach 2mn bpd by 2035 under a $25bn plan.
KPC set up a new subsidiary, Kuwait Inte- grated Petroleum Industries Co. (KIPIC), to carry out the development of the downstream and LNG import facilities in the southern port of Al-Zour, with the refinery to be commissioned in 2020. The second phase will involve the con- struction of a new refinery. Buaijan noted that KNPC will be building 58 petrol stations over three phases that will be completed by 2024, adding that Pan Arab Consulting Engineers had been chosen to provide consulting and engineer- ing services or phases 1 and 2.™
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w w w . N E W S B A S E . c o m Week 35 05•September•2019