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State-owned oil giant Saudi Aramco and France's Total signed an agreement to develop a network of retail fuel service stations in Saudi Arabia, the company said in a statement on Thursday.
The 50:50 joint venture (JV) plans to invest around $1 billion over the next six years in the Saudi retail fuel market to provide motorists with premium fuels and retail services in the Kingdom, the statement said.
“With this new business, we aim to enhance the quality of services, as well as create jobs and additional investment opportunities in the Kingdom. This JV aligns with Saudi Vision 2030 and supports the goals of the Infrastructure and Transportation Initiative under the Quality of Life program. This project is designed to also help optimize the total value of our hydrocarbon resources,” Abdulaziz Al-Judaimi, Saudi Aramco’s senior vice president of Downstream and chairman of the JV Board, said.
“This joint agreement is in line with our strategy to expand in fast-growing markets worldwide. Following our joint investments in SATORP refining and petrochemical complex, we are pleased to bring to the Saudi market our expertise and customer-minded approach in retail and contribute to local employment development,” Momar Nguer, president of Marketing and Services and Executive Committee Member at Total, said.
The two companies have also signed an agreement with the owners of Tas’helat Marketing Company (TMC) and Sahel Transport Company (STC) to acquire TMC and STC, thereby jointly acquiring their existing network of 270 service stations and their fuel tanker fleet.
Saudi Aramco and Total plan to modernize this network and build high-quality service stations at selected locations. This transaction is subject to approval of regulatory authorities.
“Our goal is to provide high-quality services through this venture that support the tourism industry in the Kingdom and reflect our country’s progress in developing the infrastructure and a reliable service industry,” Ahmed Al-Subaey, vice president of Marketing, Sales, and Supply Planning and Chairman of the Board of RetailCo., said.
The JV will take a phased approach to expanding its network of domestic fuel retail stations, with a plan to reach the goal of owning and operating hundreds of stations by 2021.
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