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05-07-2025
RIYADH: Saudi oil giant Aramco, opens new tab is looking to sell up to five gas-fired power plants, three sources with knowledge of the matter told media, part of a broader effort to free up funds that could generate tens of billions of dollars.
The potential sale of four or five gas-fired plants that power refineries could alone raise around $4 billion as the Saudi government pushes Aramco to increase profits and payouts to the state, two of the sources said.
Aramco, the world’s most profitable company and the main source of Saudi state income, has been looking to sell some assets, improve efficiency and cut costs, media has reported.
The company will also slash dividend payouts by nearly a third this year as lower oil prices hit its income.
The state, which directly owns 81.5% of Aramco, is heavily reliant on the payouts, which include royalties and taxes.
Besides the sale of the gas-fired plants, the company could divest assets such as housing compounds and pipelines, two of the sources said. Port infrastructure assets could also be up for sale, one of them and a third person said.
Aramco declined to comment on the potential asset sales and had no immediate comment on the amount of money the fundraising drive could yield.
The Saudi government communications office did not respond to media requests for comment.
Media could not determine a timeline for the sale. The three sources spoke on condition of anonymity because the process is private.
Local businesses like Saudi utility firms could be interested buyers, one of the people said.
Aramco fully or partly owned 18 power plants and related infrastructure locally supplying energy to its gas plants and refineries, according to its 2024 financial report.
Other power plants are expected to come on-stream soon. The Tanajib Gas Plant project is expected to start operations this year.
The potential asset sales by Aramco coincide with Saudi Arabia Crown Prince Mohammed bin Salman’s planned massive domestic projects to diversify the economy from oil while facing pressure from tumbling crude prices.
Oil receipts made up 62% of state revenues last year with the Saudi budget showing a deficit of more than $30 billion in 2024 despite a $199 billion windfall from Aramco.
Aramco sold $5 billion of bonds in May and signaled more borrowing.
The country is pouring hundreds of billions of dollars into projects including showpiece events like the Expo 2030 world fair and soccer’s FIFA World Cup 2034.
Aramco is also seeking to raise funds for infrastructure by bringing in investors, media reported in May.
In March, Saudi oil giant Aramco signaled on Tuesday it will slash its dividend payouts by nearly a third this year, meaning fewer funds for the kingdom as it races to complete several mammoth projects and possibly faces a wider budget deficit.
Aramco, opens new tab said it expected to declare total dividends of $85.4 billion in 2025, down sharply from last year’s payout of over $124 billion, which it said was, however, based on 2023 and 2024 earnings.
The Saudi government directly owns 81.5% of Aramco, while its sovereign wealth fund controls an additional 16%. It has long leaned on the group’s payouts to invest in myriad sectors as it tries to wean the economy off oil. Those efforts include building or renovating 15 stadiums for the 2034 World Cup, the most high-profile of several showpiece events the kingdom will host. (Int’l News Desk)
