Saudi Arabian firms have embarked on a wide range of strategic business collaborations with Russian energy entities with the signing of several MoUs that will see an increase in Russian investments in the Kingdom.
Amin H. Nasser, Saudi Aramco President and CEO, said at a panel discussion at the Saudi-Russian Business Investment Forum that the rich endowment of resources of both the Kingdom of Saudi Arabia and the Russian Federation can enable companies from both countries to collaborate in creating synergies for a sustainable energy future with business and operational initiatives driven by technology, research and innovation.
The forum was held in conjunction with the Royal Visit to Russia by the Saudi Arabian King Salman bin Abdulaziz Al-Saud.
Nasser outlined a number of areas for potential collaboration with Russian companies in industrial localization; international gas; downstream petrochemicals; technology, research and innovation; trading; and climate change and carbon management.
Nasser also provided strategic insights on the future of energy and how the Kingdom and Russia could pool their sizable resources together in driving the global energy transformation by factoring in alternative energy which can complement oil’s existing preeminence, particularly gas and downstream / chemicals.
Nasser stressed that all these could only be achieved with technology, research and innovation. Saudi Aramco considered this as key drivers of future success, and Saudi Aramco’s goal is to be a world-leading creator of energy and chemical technologies.
“We have already established eight research centers around the world that complement our main research facilities in Saudi Arabia. Considering Russia’s considerable strengths in science and technology, as well as highly talented researchers, scientists and engineers, we are exploring collaboration in R&D field,” he said.
He also highlighted Saudi Aramco’s industrial localisation program In-Kingdom Total Value Add, or iktva, as another area of opportunity for Russian services and manufacturing companies to collaborate with Saudi partners.
Saudi Aramco signed five MOUs with key Russian energy entities during the King's Visit.
One was with Saudi Public Investment Fund and Russian Direct Investment Fund that will look at investment in energy services and manufacturing. The second MoU was between Saudi Aramco and Gazprom to look at developing a business portfolio in international upstream gas, , allowing the introduction of new vendors and suppliers to the Kingdom’s market.
A third MOU will see collaboration with Swiss-based LITASCO (the international marketing and trading arm of LUKOIL which will give Saudi Aramco and the Kingdom access to Mediterranean refineries where Russian companies have been expanding. The fourth MoU is focused on technology and R&D collaboration and was agreed with Gazprom Neft.
The final MoU was with with Russian Direct Investment Fund and SIBUR and will enable all parties to jointly evaluate potential opportunities for cooperation in the petrochemicals sector, including marketing of petrochemicals products, both on in Russia and Saudi Arabia.