MOSCOW (MRC) -- Saudi Aramco, the world's biggest oil company, will issue a multi-tranche international bond, reported Business Insider with reference to a filing with the national stock exchange.
The company has hired Citi, Goldman Sachs International, HSBC, JP Morgan, Morgan Stanley and NCB Capital to underwrite the sale.
Aramco did not specify how large the dollar-denominated issuance would be, but it is expected to run into the billions, as the company struggles with a historic hit to oil demand.
Saudi Aramco, the world's largest oil company, plans to issue an international bond, as it works to shore up its finances in light of the collapse in demand for crude oil this year.
In a filing with the Riyadh stock exchange on Monday, Aramco said it would issue dollar-denominated bonds of varying maturities - 3-, 5-, 10-, 30- and possibly 50-years - but did not specify how large the sale would be.
"The bonds will be senior, dollar denominated, unsecured by assets," Aramco said in a filing.
Citi, Goldman Sachs International, HSBC, JP Morgan, Morgan Stanley and NCB Capital have been appointed as underwriters for the sale, the filing showed.
Aramco, which reported a near-45% drop in net profit in the third quarter just two weeks ago, has struggled to shore up its balance sheet this year, much like its rivals, as the COVID-19 pandemic has destroyed energy demand and kept crude prices below USD40 a barrel for much of the past six months.
The company also committed to paying a dividend of USD18.75 for the third quarter.
The company has repeatedly cut official selling prices to its big customers in Asia to try to maintain demand, even as air, sea and road transport in the region remain below pre-pandemic levels.
Ratings agency Fitch last week lowered its outlook on Saudi Aramco's debt to negative and maintained its "A" rating, in line with the same decision on November 10 on its sovereign rating for Saudi Arabia.
Aramco made its then-record-breaking debut on the stock market last December. Its shares since then have fallen by 9% to around 35.30 riyals. But this is a far cry from the 31% drop so far this year in the price of crude oil.
As MRC wrote before, Saudi Aramco and Saudi Basic Industries Corporation (SABIC) have decided to reevaluate their crude-oil-to-chemicals project in Yanbu on the kingdom's west coast, according to an Oct. 18 statement on the Tadawul stock exchange, as they slash spending due to low prices. The USD20 billion project may be downsized to use Aramco's existing facilities in the port city, instead of building a new plant, the statement posted by SABIC said.
We remind that in June, Aramco said it had completed the share acquisition of a 70% stake in SABIC from the Public Investment Fund, the sovereign wealth fund of Saudi Arabia, for a total purchase price of Riyals 259.125 billion (USD69.1 billion). Combined, in 2019 Aramco and SABIC recorded petrochemicals production volume of nearly 90 million mt, including agri-nutrient and specialty products.
Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).
According to MRC"s ScanPlast report, Russia"s estimated PE consumption totalled 1,594,510 tonnes in the first nine months of 2020, up by 1% year on year. Only high denstiy polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers" inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.
Saudi Aramco, officially the Saudi Arabian Oil Company, is a Saudi Arabian national oil and natural gas company based in Dhahran, Saudi Arabia. Saudi Aramco"s value has been estimated at up to USD10 trillion in the Financial Times, making it the world"s most valuable company. Saudi Aramco has both the largest proven crude oil reserves, at more than 260 billion barrels, and largest daily oil production.
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