Dhahran, Saudi Arabian Oil Company’s Q3 Net Income Drops, Strategic Expansion Announced

Dhahran, in a significant financial development, the Saudi Arabian Oil Company (Saudi Aramco) revealed its third-quarter results for 2023. The figures indicated a decrease in net income, which stood at SAR122.2 billion ($32.6 billion), compared to SAR159.1 billion ($42.4 billion) during the same period in 2022.

According to Saudi Press Agency, cash flow from operating activities for the third quarter of 2023 was SAR117.6 billion ($31.4 billion), showing a decline from SAR202.5 billion ($54.0 billion) in the third quarter of 2022. Additionally, the company's free cash flows reached SAR76.3 billion ($20.3 billion) in this quarter, a decrease from SAR168.6 billion ($45.0 billion) in Q3 of 2022.

The report highlighted that the gearing ratio was -7.6% as of September 30, 2023, slightly improved from -7.9% at the end of 2022. It was noted that the Q2 of 2023 base dividend of SAR73.2 billion ($19.5 billion) was paid in the third quarter, and a similar amount will be paid for Q3 in the fourth quarter of 2023.

Furthermore, the report detailed the distribution of the first performance-linked dividend of SAR37.0 billion ($9.9 billion) in the third quarter, with a second distribution of the same amount slated for the fourth quarter. These distributions are based on the combined full-year 2022 and nine-month 2023 results.

Significantly, the report outlined Saudi Aramco's strategic expansion plans. The company has agreed on its first international liquefied natural gas (LNG) investment and intends to enter the South American market through a downstream retail acquisition. This marks a substantial move in diversifying its business operations.

Additionally, the report showed an increase in raw gas processing capacity by 800 million standard cubic feet per day (mmscfd) through the Hawiyah Gas Plant expansion. This includes approximately 750 mmscfd of sales gas processing capacity. Furthermore, collaboration with Stellantis has confirmed eFuel compatibility with 24 engine families in Europe, indicating progress in sustainable energy solutions.

Aramco President and CEO Amin H. Nasser, in a press release, emphasized the company’s robust financial results and its consistent value generation for shareholders. He highlighted the new investment in LNG and the planned entry into the South American retail market as evidence of Aramco's ambitious and broad scope of activities.

Nasser reiterated the company’s commitment to investing across the hydrocarbon chain, leveraging advanced technologies for optimizing operations, and advancing the development of emerging energy solutions. He emphasized a balanced approach to the energy transition, considering the needs of global energy consumers to avoid disparities.