Saudi Aramco's bid on a Houston oil refinery is a big strategic
bet
http://economictimes.indiatimes.com/news/international/business/saudi-aramcos-bid-on-a-houston-oil-refinery-is-a-big-strategic-bet/articleshow/54309844.cmsSep 13, 2016
The Saudi national oil company is making a bid to significantly expand its
operations in the United States at a critical moment in the always uneasy relations between
the United States and Saudi Arabia.
The company, Saudi Aramco, aims to strengthen its position on the Gulf of Mexico coast by
buying a large oil refinery in the Houston Ship Channel that LyondellBasell is putting up for
sale.
And despite geopolitical tensions between Riyadh and Washington, Saudi Aramco sees the
potential acquisition as a way to shore up its exports at a time of erosion in the oil business
on which the Saudi economy is still largely reliant. Because of plunging prices, the value of
Saudi oil sales has shrunk in recent years. And Saudi Arabia's archrival, Iran, is becoming a
more potent commercial competitor now that it is exporting substantial quantities of crude.
Four years ago Saudi Aramco completed a $10 billion expansion of a giant oil refinery in Port Arthur, Texas, in a joint venture with Royal
Dutch Shell called Motiva Enterprises. The converted plant is now the biggest producer of gasoline, diesel and other petroleum products in
the United States.
This time, Saudi Aramco wants to do a deal on its own. But its negotiations with LyondellBasell, a Dutch company, come as Congress is
moving to allow families of victims of the Sept. 11, 2001, terrorist attacks to sue Saudi Arabia for supposed ties between government
officials and the terrorists, most of whom were Saudi citizens. The Obama administration has threatened to veto the measure, although an
override is possible.
Saudi officials have denied any role in the attacks and have threatened to sell $750 billion in US assets, including Treasury securities, held
by the Saudi government if the congressional measure moves forward.
But energy experts say the quiet bid by Saudi Aramco is designed to further protect its share of the US oil market, even as Washington
and US oil companies continue efforts to wean the country off foreign oil.
Saudi Aramco did not respond to questions about the bidding. A spokeswoman for LyondellBasell said she had no comment....
