Saudi Aramco Creates Standalone Gas Division to Raise Capital

The Saudi Arabian Oil Company is reorganizing its business structure by creating a standalone gas division, expanding from two main segments—upstream and downstream—to three. Each of the three units will be led by its own president. This strategic shift creates a focused platform for developing domestic natural gas resources, specifically the Jafurah unconventional shale gas field, and building an international liquefied natural gas portfolio.

The reorganization aims to raise capital through potential minority listings of business units or lease-and-leaseback agreements. This approach mirrors strategies used by other Gulf state oil companies, such as the Abu Dhabi National Oil Company, to attract outside investment while maintaining operational control. By developing the Jafurah field, the company intends to displace oil used for domestic power generation to increase crude exports, supporting Saudi Arabia's broader goal of reducing economic reliance on oil.

Aramco has already utilized this financial model, having raised $11 billion last year through a lease-and-leaseback agreement for Jafurah gas processing facilities. That deal was executed with a consortium led by Global Infrastructure Partners, a subsidiary of BlackRock.