Saudi Aramco enters LNG market

Aramco, one of the world’s leading integrated energy and chemicals companies, will acquire a strategic minority stake in liquefied natural gas (LNG) company MidOcean Energy for US$500 million.

MidOcean Energy is currently in the process of acquiring interests in four Australian LNG projects, with a growth strategy to create a diversified global LNG business. The strategic partnership with MidOcean Energy marks Aramco’s first international investment in LNG.

“We are pleased to be strengthening our strategic partnership with EIG through this acquisition, which marks Aramco’s first international investment in LNG,” said Amin H. Nasser, Aramco President & CEO. “We anticipate strong demand-led growth for LNG as the world continues on its energy transition journey, with gas being a vital fuel and feedstock in various industries. We believe that gas will be important in meeting the world’s rising need for secure, accessible and more sustainable energy.”

The agreement builds on the relationship between Aramco and EIG, which was part of a consortium that acquired a 49% stake in Aramco Oil Pipelines Co., a subsidiary of Aramco, in 2021.

Completion of the transaction is subject to closing conditions which include regulatory approvals. Aramco also has the option to increase its shareholding and associated rights in MidOcean Energy in the future.

Nasir K. Al-Naimi, Aramco Upstream president, said the acquisition is an important step in Aramco’s strategy to become a leading global LNG player.

“We see significant opportunities in this market, which is positioned for structural, long-term growth,” Al-Naimi said. “MidOcean Energy is well-equipped to capitalize on rising LNG demand, and this strategic partnership reflects our willingness to work with leading international players to identify and unlock new opportunities at a global level.”

Blair Thomas, EIG Chairman and CEO, said the company believes LNG has a key role to play in enabling an orderly energy transition that balances society’s twin goals of decarbonization and energy security.

“Concurrent with that, we believe the LNG industry is ripe for change and there is a role for a nimble, pure-play company like MidOcean Energy,” Thomas said. “While our initial focus is on the announced transactions in Australia, we believe the opportunity set is global. We are excited to expand our existing partnership with Aramco to include this important initiative.”

De la Rey Venter, MidOcean Energy CEO, said LNG is an integral enabler of the global energy transition, and the global LNG industry has strong fundamentals for many decades to come. “Synergistic partnerships are core to how MidOcean Energy will do business, grow and thrive. In Aramco, we have a partner that has long-term thinking in its DNA and an unwavering commitment to enduring collaborations. We look forward to pursuing many new opportunities together.”