[A-List] Saudi Arabia & the imperialist chain: privatisation?

["Keaney Michael" <Michael.Keaney@xxxxxx>]

Shell and BP on alert as Saudis mull privatisation

Terry Macalister
Monday April 29, 2002
The Guardian

Saudi Aramco, the biggest oil group in the world, could be broken up and
part-privatised in a move which has excited the interest of western oil
companies BP and Shell.

The surprise move was announced by Saudi oil minister Ali al-Naimi, who
confirmed separately his petroleum ministry had already started to
establish a publicly owned energy services company.

Saudi Aramco is a state-owned group which controls the country's
production of 10m barrels of crude a day, 12% of the world's total,
while holding a quarter of all known reserves left in the ground.

Mr Naimi said his new support services firm would provide engineering,
seismic survey and drilling work, adding "we are also studying the
possibility of privatising some of Saudi Aramco's operations".

The disclosures came in a speech at the weekend to Saudi Aramco
employees and Saudi crown prince Abdullah, who is in Texas after talks
with George Bush about the Israeli-Palestinian crisis.

The remarks about Saudi Aramco were seen as highly significant given
that western oil firms such as ExxonMobil, BP and Shell have recently
been awarded contracts to work on gas projects in the world's biggest
oil nation. Foreign firms have traditionally been kept out of the oil
and gas sector.

Crown prince Abdullah - effectively the ruler now - has made clear he
wants to modernise the economy to make it more efficient and to create
more jobs.

BP said it was too early to jump to conclusions but said it was
interested. "We would have to look and see how, when and where it
[privatisation] was to be done," said a spokesman.

The world's second largest publicly traded oil group behind ExxonMobil
is a participant in one of the three new gas projects and an industry
expert who knows BP well said "every oil company wants to be close to
where the major reserves are and Saudi Arabia is the heart of it all".

Shell said it "would not comment on this kind of thing" but sources
pointed out that Shell was an operator on one of the new gas schemes in
Saudi Arabia and had a downstream joint venture in the US with the
Saudis known as Motiva, which includes refineries and 12,000 petrol
stations. "Shell is very interested in Saudi Arabia," said the source.

While British oil groups will follow developments closely, they will be
aware that delays and policy U-turns cannot be ruled out. The gas deals
are behind schedule and have not been officially signed off yet amid
wrangling over price and other critical issues.

The 30% part-privatisation of another industrial firm, Sabic, went ahead
as expected but the anticipated sale of the remaining 70% never
happened.

Although BP and Shell will announce this week a massive downturn in
first-quarter profits, they have enormous cash reserves and
second-quarter figures will benefit from another major rise in crude
prices.

Full article at:
http://www.guardian.co.uk/oil/story/0,11319,706786,00.html

Michael Keaney
Mercuria Business School
Martinlaaksontie 36
01620 Vantaa
Finland

michael.keaney@xxxxxx