Saudi Arabian Oil Co. (Aramco) is acquiring a minority stake in MidOcean Energy for $500 million in a bid to take advantage of global liquefied natural gas (LNG) opportunities.
MidOcean Energy is an LNG company formed and managed by EIG, an institutional investor focused on the global energy and infrastructure sectors. The company, which is targeting to build a diversified, resilient, cost and carbon-competitive LNG portfolio, is in the process of acquiring interests in four Australian LNG projects, with a growth strategy to create a diversified global LNG business.
The completion of the transaction is subject to closing conditions, including regulatory approvals. Aramco has the option to increase its shareholding and associated rights in MidOcean in the future, the two companies said in a joint news release Thursday.
The agreement builds on the relationship between Aramco and EIG, which was part of a consortium that acquired a 49 percent stake in Aramco Oil Pipelines Company, a subsidiary of Aramco, in 2021. The partnership with MidOcean marks Aramco’s first foray into the global LNG market.
“We are pleased to be strengthening our strategic partnership with EIG through this acquisition, which marks Aramco’s first international investment in LNG”, Aramco President and CEO Amin Nasser said. “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”.
“This is an important step in Aramco’s strategy to become a leading global LNG player”, Aramco Upstream President Nasir Al-Naimi said. “We see significant opportunities in this market, which is positioned for structural, long-term growth. 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”.
“Energy transition informs every investment decision we make, and we believe LNG has a key role to play in enabling an orderly transition that balances society’s twin goals of decarbonization and energy security”, EIG Chairman and CEO Blair Thomas said. “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. 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”.
“It is an honor for MidOcean Energy to have Aramco as a key shareholder and strategic partner”, MidOcean CEO De la Rey Venter said. “We share the conviction that LNG is an integral enabler of the global energy transition, and we believe that 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”.
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