A split could help bring new investment into the gas unit or potentially lead to an initial public offering or a minority listing valuing the business at over US$100 billion, the people said.
Deliberations are continuing and the plans could change, said the people, asking not to be identified discussing private information. Aramco declined to comment.
Evercore also declined to comment. The investment bank has worked on several of Aramco’s strategic initiatives, including its IPO in 2019.
Boston Consulting Group (BGC) also played a role in developing the plans, according to people familiar with the matter, advising Aramco to split off its gas operations in an effort dubbed Project Gamma. The firm advised the Saudi company to proceed with the move as a way to unlock more value, the people added. BCG didn’t immediately respond to requests for comment.
Reuters reported on Sept. 22 that Aramco was planning to reorganise its business to create a new gas division with an eye to a potential future listing.
A valuation of the gas business at US$100 billion or more would put the unit at about three times as much as Aramco’s listed chemical unit Sabic, which has seen its share price fall by more than 20% over the past year. It’s also more than the nearly US$70 billion Aramco agreed to pay in 2020 to acquire Sabic.
Aramco is working to sell assets worth as much as US$35 billion to free up funds for state projects and dividend payouts. The company has been exploring the sale of a piece of its vast real estate portfolio, as well as a stake in its oil export and storage terminals.
Growth in Aramco’s gas business is centered around the Jafurah project. The oil giant is investing more than US$100 billion to develop the unconventional field using hydraulic fracturing, or fracking, techniques developed in the US shale patch.
Jafurah, which started its first phase at the end of 2025, and other developments will help Aramco boost gas production by about 80% over the decade through 2030.
By then the company targets as much as US$15 billion in incremental operating cash flow from the gas business. That would still make it much smaller than Aramco’s core oil production operations, which the company says can generate about US$10 billion for every additional one million barrels a day the company produces. It pumped on average 10 million barrels a day last year.
The deliberations come as the US-Iran war has spread across the region and stretched into a seventh month with no obvious end in sight.
Recent attacks in Saudi Arabia have forced the closure of a key pipeline, and on Saturday, Saudi-backed coalition forces in Yemen said air defences intercepted two drones launched by Iran-backed Houthi militants towards Riyadh, as well as a ballistic missile targeting the southern border area of Khamis Mushait. Air raid alerts that sounded in the Saudi capital a week ago were the first there since the height of hostilities in March and April.
Yet despite uncertainties across the region, some deals have gone ahead. In July, Kuwait agreed a US$16 billion infrastructure deal with Blackstone Inc, Brookfield Asset Management Ltd and KKR & Co involving its oil-export pipelines.
Growth in the gas business would be a change for Saudi Arabia, which in the past had to allocate limited gas supplies to industries, and regularly burned oil in its power plants to cope with summer heat and air conditioning demand. The new supplies will help free up about one million barrels a day of crude for export that would otherwise go to running domestic power plants. Aramco will potentially have extra gas to export either as LNG or through use in data centres.
On top of that, the company is building up a portfolio of LNG contracts from global projects in places like the US Gulf coast, giving it cargoes of the fuel it aims to trade.
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