Speaking on the sidelines of the St. Petersburg International Economic Forum on Thursday, BP Plc hinted that it was not interested in the Saudi Aramco IPO.
The IPO for the state-run Saudi oil giant will proceed next year and will likely be for less than 5 percent of the company, and earlier rumors had suggested that BP might take part in the deal.
BP CEO Bob Dudley told reporters in St. Petersburg that it’s “unlikely we would be a financial investor in Saudi Aramco.”
BP is the second major company to suggest it is not interested in the IPO, following Russian Lukoil, which made a similar statement earlier this month.
That leaves Exxon Mobil and China’s Sinopec as the remaining potential contenders, but still in the realm of rumor.
The IPO is a way for Saudi Arabia to raise funds in the prevailing low oil price atmosphere, with Saudi Aramco likely to be valued at over $2 trillion, and the 5 percent could raise around $100-$150 billion.
Saudi Aramco is highly profitable and controls vast swaths of lucrative resources, but only a portion of those assets will be up for sale. The country’s oil reserves are unlikely to be included in the IPO. Instead the IPO will probably be for a subsidiary, which includes downstream assets of Saudi Aramco.
According to some analysts, the IPO could be a boon for the banking sector, which could bring in some $1 billion in fees.
By Charles Kennedy of Oilprice.com
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