Aramco’s ambition is to create an LNG business that is tied to trading and can fully realise offtake value – and it is taking a similarly firm stance with hydrogen and ammonia.
Speaking on a call following the release of Q3 results, in which it reported $27.6bn net income (down from $32.6bn on Q3 2023), Ziad Al-Murshed, Executive Vice-President and Chief Financial Officer said, “We are ramping up LNG trading capability to be able to capture this value from the portfolio. We do look at it as one business. We’ve earmarked a considerable volume of gas that’s coming out of production for blue ammonia and blue hydrogen, and that will only proceed if we get commercial long term offtakes.”
“We continue to work on discussions with potential offtakers for blue ammonia – unless this is tied to long term commercial offtake we’re not able to proceed with these projects. We will have a much better view towards the end of the year.”
Aramco made a further investment in MidOcean Energy to fund its acquisition of an additional 15% interest in Peru LNG (PLNG), increasing MidOcean’s stake in PLNG from 20% to 35%.
Aramco and Sempra, through their respective subsidiaries, executed a non-binding Heads of Agreement (HoA) for a 20-year sale and purchase agreement (SPA) for LNG offtake of 5 million tonnes per annum (Mtpa) from the Port Arthur LNG Phase 2 expansion project in June.
In hydrogen, Aramco continues to advance discussions with a number of potential international customers to secure offtake agreements, which provide the ‘anchor’ to economic returns.
In July, the energy major signed definitive agreements to acquire an equity interest in the Jubail-based Blue Hydrogen Industrial Gases Company (BHIG), a wholly owned subsidiary of Air Products Qudra (APQ). The transaction will also include options for Aramco to offtake hydrogen and nitrogen.
Through its group capability and know-how, natural gas feedstock for ammonia, and carbon capture sequestration expertise, Aramco is in a sweet spot with blue ammonia and blue hydrogen.
On renewables, Aramco has a pipeline of projects totalling 12 GW by 2030, with 5.5GW reaching financial close.
“We are more than a third of the way of meeting our 2030 target. We’re looking to take renewable credits and utilise those towards our ambition of Net Zero by 2050,” he said.
MENA Industrial Gases Conference
In 2024, the Middle East & North Africa region home to both an enviable climate in renewable resources and investment and a bold vision in decarbonisation, green energy and industrial value chains.
From Saudi Arabia to Qatar, the UAE to Oman, and Mauritania to Morocco, there are promising gas and energy ecosystems-in-the-making. Vision 2030 is the mantra, and global leadership the goal.
But how can a vision for 2030 translate to a vision for industrial gas and equipment growth?
Join gasworld in November 2024 as its MENA Industrial Gases Conference 2024 returns to Abu Dhabi.
To attend, sponsor and for more information, visit: https://bit.ly/GWMENA-S24
