The Saudi Arabian Oil Company or Saudi Aramco on Tuesday confirmed its record-setting IPO will move forward as planned despite the disruptions and damage wrought by an accurate bombardment of two of its oil installations by what now appears to be stealthy Iranian cruise missiles.
The low-level attacks by at least 20 “Hoveyzeh” Iranian cruise missiles early Saturday morning knocked-out out more than half of Saudi Aramco’s production capacity.
Saudi Aramco chairman Yasir al-Rumayyan said preparations and paperwork for the company’s highly anticipated initial public offering continue.
“The IPO is a commitment by the shareholder, the government of Saudi Arabia, and we think the IPO will continue as is, we are not going to stop anything,” said al-Rumayyan.
“This would make us even be firm when it comes to taking the company public, so I think anytime in the coming 12 months we’ll be ready as per the market opportunity.”
Saudi Aramco, the largest source of revenues for Saudi Arabia, plans to list 1% of its shares on the Saudi Stock Exchange or Tadawul before the end of this year. A further 1% will be offered in 2020 as the first steps ahead in a sale that will see some 5% of the company sold to the public.
This will make the Saudi Aramco IPO the largest in the world.
In the wake of the Iranian attacks, the price outlook and investor confidence in the IPO now depends heavily on how fast Saudi Aramco can restore full production capacity to its damaged Abqaiq oil refinery, the country’s main oil production facility, and the nearby Khurais oil field.
Abqaiq is the world’s largest oil processing facility and crude oil stabilization plant with a processing capacity of more than 7 million barrels per day (bpd). Khurais can pump around 1.5 million bpd from its oil wells.
Saudi Aramco CEO Amin Nasser noted that despite the oil attack being “huge,” the company was able to restore capacity.
“We have enough oil products to supply the local market,” said Nasser.
He also said Saudi Aramco will compensate local refineries with additional feed in the next few days.
Both sites will be fully online by the end of this month, said Prince Abdulaziz bin Salman, the country’s energy minister.
“Where would you find a company in the whole world that went through such a devastating attack and came out like a phoenix?” bin Salman asked the audience during a news conference.
He said 50 percent of the crude production cut from the attack was restored in the past two days. Crude oil production capacity at Abqaiq will reach 11 million bpd by the end of September and 12 million bpd by the end of November, said bin Salman.
“We are in the process to bring back oil refining to full capacity,” said bin Salman. “The company will honor all of its commitments to its customers this month by drawing from its reserves of crude oil and further modified some of its oil until the production capacity of the country is up to 11 million barrels a day by the end of September and up to 12 million barrels in November.”