Source: Ayman Makki / CC BY 3.0

The anticipation of the acclaimed Aramco IPO grows while the state-owned company stalls amid indecision. As they iron out the details of where to list the public entity, it has become abundantly clear their eyes are also fixed on American Shale Country.

IPO Status

Saudi Arabia is in search of strategic investors as the initial public offering (IPO), which could be the biggest in history, is set to be carried out in October or November of 2018.

They plan to sell up to five percent of Aramco shares on one or more foreign exchanges. The state-owned oil company of the Kingdom of Saudi Arabia could be valued at as much as $2 trillion, which would raise over $100 billion in the event of the IPO.

It has been speculated that the decision as to which international exchange, either London, New York or Hong Kong that Aramco will be listed under should come by March. This is seen as a deadline that will need to be met in order for the IPO to be carried out in 2018.

Asian cornerstone investors may seem like the most logical choice as that is where the majority of Aramco oil flows. On the other hand, Aramco is also highly interested in becoming a more diversified company with oil-and-gas production assets outside of Saudi Arabia and overseas investors may be more supportive of the purchase of U.S. assets.

Interest in American Shale Country

To date, the only U.S. assets owned by Aramco are their refineries and the country uses some of its oil reserves to produce electricity. Their oil reserves may be 13 times as large as those of their nearest competitor, Exxon Mobil, but they would like to save those more valuable resources for export.

American shale country is of high interest. Not only do they own U.S. refineries that could make use of these feedstocks, they would help the company, and country, make better use of oil produced at home as they could use more natural gas sourced from the U.S. to produce electricity.

Sources:

In Aramco IPO, China talks crucial for choice of listing venue: sources

Why Saudi Arabia Is Looking for Oil and Gas in the U.S.