Crude oil refining
With its strategic location, long-term supply security and rapidly improving infrastructure, Saudi Arabian refining represents a huge investment opportunity.
Strong global demand
The forecast is very favorable for crude oil refining. The global demand for refined petroleum products is expected to remain very strong, driven by rapid and resilient growth in emerging markets. Meanwhile, tight capacity worldwide has elevated utilization rates and pushed margins to historic highs. In fact, refinery utilization rates are forecast to exceed 86% by 2010 with demand at 93 million bpd and set to double by 2030.
New refineries in development
In response, Saudi Aramco has partnered with foreign companies to develop three new export-oriented refineries at a cost of US$18 billion and is planning a series of expansions and upgrades to its existing refineries. Further private refining projects are also under consideration. Together, these projects will offer very substantial investment opportunities in related services.
Unlike many refineries located outside KSA, the new facilities will offer large-scale capacity to process local heavy and sour crude. The latest technologies will be used to mitigate their environmental impact relative to older facilities elsewhere in the world.
Competitively priced feedstock and supply security
As owners of the world’s largest proven oil reserves, KSA is in a unique position to offer competitively priced feedstock and unparalleled long-term supply security. Customers will benefit from Saudi’s proven, world-class infrastructure and its secure supply of locally produced and refined products from locations such as Jubail and Yanbu.
Low-cost access to diverse markets
Finally, KSA’s strategic location between Asia, Europe and North America is a significant logistical competitive advantage as it offers low-cost access across a diverse portfolio of markets. Investors are also seeing new opportunities open up as Saudi Arabian markets are progressively deregulated.
Good reasons to invest
- Strategic geographic location between markets in Asia, North America and Europe
- Strong domestic, regional and global demand for refined products due to rapid economic growth in Asia, the Middle East and Eastern Europe
- Very high long-term supply security
- Competitively priced feedstock and energy
- Excellent export infrastructure
- Deregulating markets