Saudi Aramco’s bond debut is intended to inspire confidence as company fires up global expansion strategy, says GlobalData

Following Saudi Aramco’s bond debut and the release of their bond prospectus on April 1, 2019,

Anna Belova, Senior Oil and Gas Analyst at GlobalData, a leading data and analytics company, offers her view on the company’s current strategy:

“As the world’s most profitable company, it can be argued that Aramco does not need to resort to debt offering and that the bond serves a secondary purpose to inspire confidence and offer new transparency into Aramco’s finances, as the company fires up its global expansion strategy.

“Beyond the stated goal of acquiring SABIC, Aramco is pursuing multiple gas, midstream and downstream opportunities worldwide, one of which is a large stake in a new Russian integrated LNG project Arctic LNG-2. Following Aramco’s prospectus release, details began to emerge that the company’s share in Arctic LNG-2 will exceed 30%.

“With similar timing, the government of Turkmenistan highlighted that Aramco could participate in the giant TAPI pipeline, connecting Turkmen fields to India’s markets. Russian and Turkmen governments might be the first interests swayed by the bond details, but will not be the last.”