A joint Russia-China investment fund is gearing up to participate in Saudi Aramco’s forthcoming IPO, the CEO of the Russian Direct Investment Fund Kirill Dmitriev said during a visit by a high-level delegation of ministers and leading businessmen to Riyadh this week. Energy Minister Alexander Novak also travelled to the Saudi capital, as Russia stepped up attempts to finalise several multi-million-dollar investment deals worth a combined total of over $2bn with the KSA over the next three months.
Projects known to be in the mix include the Arctic LNG 2 development on the Gydan peninsula across the Gulf of Ob from the now-operational Yamal LNG project; the $1bn petrochemical plant that Russian Sibur plans to build for Saudi Aramco; and an agreement that would see Russia’s biggest oil service provider Eurasia Drilling Company and the Novomet oil equipment produce supply services and parts, also to Saudi Aramco.
The prospect of Beijing and Moscow joining forces to buy part of the 5% stake in Aramco that Saudi Arabia plans to put up for sale through an IPO later this year was raised in the same week that Russian President Vladimir Putin and Saudi King Salman held a telephone conversation in which both leaders “expressed readiness to expand fruitful coordination on world hydrocarbon markets,” according to a statement released by the Kremlin.
In further confirmation that the two countries have – for now – abandoned their long-time rivalry and intend to strengthen their energy ties after reaching an accord to cut input in order to prop up crude prices amid a surge in output from US shale drillers, the Rosatom State Corporation also announced that it had filed an application for participation in a tender for the construction of two power units of a nuclear power plant in Saudi Arabia.
“Today we touched upon the issue of cooperation in the nuclear industry. Here we also made very good progress, since our company Rosatom has already applied for a tender for the construction of two nuclear power units,” Russian Energy Minister Alexander Novak told reporters in Riyadh.