• 4 minutes US-backed coup in Venezuela not so smooth
  • 7 minutes Why Trump will win the wall fight
  • 11 minutes Oil imports by countries
  • 13 minutes Maduro Asks OPEC For Help Against U.S. Sanctions
  • 18 hours Climate Change: A Summer of Storms and Smog Is Coming
  • 17 hours Tension On The Edge: Pakistan Urges U.N. To Intervene Over Kashmir Tension With India
  • 18 hours The Quick Read On MBS's Tour of Pakistan, India And China
  • 17 hours Teens For Climate: Swedish Student Leader Wins EU Pledge To Spend Billions On Climate
  • 18 hours BMW to add 2,000 more jobs at Dingolfing plant
  • 19 hours Iran Starts Gulf War Games, To Test Submarine-Launched Missiles
  • 19 hours Venezuela: Nicolas Maduro closes border with Brazil
  • 2 days Amazon’s Exit Could Scare Off Tech Companies From New York
  • 1 day Itt looks like natural gas may be at its lowest price ever.
  • 20 hours Saudi A to Splash $100 Bln on India
  • 13 hours Washington Eyes Crackdown On OPEC
  • 15 hours Indian Oil Signs First Annual Deal For U.S. OilIndian Oil Signs First Annual Deal For U.S. Oil
  • 1 day NEW FERUKA REFINERY
Alt Text

An Underestimated Niche In Oil & Gas

Decommissioning obligations in the global…

Alt Text

How Long Will This Oil Rally Last?

Oil prices have been trading…

Irina Slav

Irina Slav

Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.

More Info

Trending Discussions

Reeling From Low Oil Prices, Saudis Look To Freeze Megaprojects

Saudi Arabia will start reviewing a number of multi-billion-dollar infrastructure and development project—remnants from a better past when crude oil prices were in three-digit territory. Some of these, according to government sources, will be shelved and others will be restructured.

The review is part of urgent reforms prompted by the oil price rout from 2014, which saw Saudi Arabia plunge into a budget deficit for the first time in its history. As part of efforts to reform the oil-reliant economy, last year Deputy Crown Prince Mohammed bin Salman removed from their positions the Kingdom’s long-serving oil and finance ministers, Ali al-Naimi and Ibrahim al-Assaf.

At the time, the Finance Minister defended these same megaprojects that will now be scrutinized by the Bureau of Capital and Operational Spending Rationalization, saying that when the investment decisions were made, the economic outlook was very different from where it was in 2016.

At the end of last year, the Saudi government calculated that the cost of completing all these projects would come in at $370 billion (1.4 trillion riyals). Now, those that are deemed still feasible will be retendered, the unnamed sources told Reuters, to be completed through public-private partnerships under build-operate-transfer contracts. This type of contract allows developers to complete a project and operate it for a set period, aiming to get some profit out of it before transferring ownership to the government. Related: Attack On Syria: U.S. Has Returned To “Business As Usual”

The Deputy Crown Prince who is in charge of turning the oil-dependent Kingdom around seems determined to do his job well, including through diversifying the economy into renewable energy with the extremely ambitious Vision 2030 plan, which stipulates that Saudi Arabia could start generating most of its energy from renewable sources as soon as 2030.

Meanwhile, however, sources from OPEC have confirmed that the Kingdom, along with other Gulf producers, are seeking oil prices of $60 to patch up their budgets and set aside some cash for new oil and gas investments.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage

Trending Discussions


Leave a comment
  • Harris Barlow on April 17 2017 said:
    Saudi Arabia seems to be in an untenable place; one where they are having to reign in production to support prices, while also needing to produce more to increase revenues. They will never be able to do both, so at some point....

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News