On the second day of the 24th World Petroleum Congress held at the Big 4 Building in Stampede Park in Calgary, Canada, on September 18, 2023, Aramco (officially known as Saudi Arabian Petroleum Group, Saudi Arabian Oil and natural gas company) logo.
Artur Vidak | Noor Photos | Getty Images
Saudi Arabia’s state-owned oil giant Aramco reported a 25% drop in profits to $121.3 billion in 2023, down from $161.1 billion in 2022.
“The year-on-year decline can be attributed to lower crude oil prices and sales volumes, as well as lower refining and chemicals margins, but was partially offset by lower production royalties during the year and lower income taxes and zakat,” Aramco said in a statement. statement.
Saudi Aramco said total revenue also fell 17% to $440.88 billion, down from $535.19 billion last year.
The result still represents Aramco’s second-highest net profit ever. Free cash flow also fell to $101.2 billion in 2023, compared with $148.5 billion in 2022.
“Our resilience and agility have contributed to healthy cash flow and high levels of profitability despite economic headwinds,” Saudi Aramco CEO Amin Nasser said.
Changed hands
The financial report comes after the Saudi government transferred an additional 8% of Aramco shares worth $164 billion to the Saudi Public Investment Fund (PIF). Yasir Al-Rumayyan serves as both chairman of the Aramco board and a director of PIF.
The share transfer to PIF is one of the largest transactions undertaken by Aramco since its listing and will allow PIF to benefit from Aramco’s huge dividend payment policy. The PIF already owns 4% of Aramco and controls financial investment company Sanabil, which also owns 4% of Aramco.
Aramco said dividends paid in 2023 totaled $97.8 billion, a 30% increase from 2022. The company announced a base dividend of $20.3 billion for the fourth quarter, which will be paid in the first quarter of 2024. Aramco also pays performance-linked dividends, worth $10.8 billion this year. Performance-related dividends for full-year 2024 are expected to be $43.1 billion.
PIF’s 16% stake in Saudi Aramco, worth an estimated $328 billion, will strengthen its financial position and improve its ability to deploy capital for investments on behalf of the Saudi Arabian government. The new stake also pushes PIF closer to its goal of $1 trillion in assets under management by the end of 2025.
more investment
Saudi Aramco confirms it will Halting plans to increase its oil production capacity from 12 million barrels per day to 13 million barrels per day, a move expected to reduce capital investment by about $40 billion between 2024 and 2028.
Nasser said: “Recent government directives to maintain our maximum sustainable production capacity at 12 million barrels per day provide greater flexibility and focus on increasing gas production and growing our liquid chemicals business. Chance.”
In 2023, Saudi Aramco’s average hydrocarbon production was 12.8 million barrels of oil equivalent per day, including 10.7 million barrels of liquids per day.
Saudi Aramco aims to increase investment in natural gas and plans to increase natural gas production by more than 60% in 2030 compared with 2021.Its flagship investment is jaffra project — The largest natural gas field in the Middle East — with gas reserves estimated at 200 megastandard cubic feet.
