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Saudi Aramco now controls 100 percent of the Port Arthur, Texas, oil refinery – the largest such facility in the United States – according to an announcement on Monday.
The deal regarding the 600,000 barrels-per-day facility had first been announced in 2016. Previously, Aramco, which is wholly-owned by the Saudi Arabian government, owned 50 percent of the refinery in a joint venture with Royal Dutch Shell.
The two oil companies’ rocky relationship caused Shell’s departure. A statement on Monday from Aramco confirmed that the split up had reached “completion” according to CNN Money.
The deal also grants Aramco full ownership of 24 distribution terminals as well as the exclusive privilege of selling Shell gasoline and diesel fuel in Georgia, North Carolina, South Carolina, Virginia, Maryland, east Texas and most of Florida.
The new setup profits Riyadh, which is preparing for the initial public offering of Aramco in 2018. It’s been declared the largest IPO in history, with the state-run company expecting a valuation of $2 trillion.
Low oil prices have caused the KSA to be concerned about the success of the IPO. This led Riyadh to push through a deal with the Organization of Petroleum Exporting Countries (OPEC) that allows the supply glut to fade over the course of 2017, before the Aramco listing goes live.
Saudi Arabia is the United States’ second-biggest crude oil supplier, after Canada. The deal will give Saudi easier access to American consumers, who will feed their cars fuel pumped from Aramco facilities worldwide.
Related: ‘’OPEC Has Failed’’
President Donald Trump, who recently completed 100 days in office, has had a rough start with both of the United States’ largest energy allies. Senior level officials from Canada and Saudi Arabia have both warned Trump of political and economic repercussions if fuel imports from either country are throttled.
By Zainab Calcuttawala of Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…