RIYADH, 27 May 2003 — Saudi Arabia has created a publicly-held energy services company with capital of SR533.3 million ($142 million) to help attract more private and overseas investment to its huge energy industry.
A Commerce and Industry Ministry statement on Sunday said the holding firm, Industrialization and Energy Services Co, would provide operations and services to the petroleum, petrochemical, power and water desalination sectors, including Saudi Aramco.
The Kingdom has said it is considering privatizing some of the operations of state-owned Saudi Aramco, the world’s biggest oil producing firm.
Industry sources have said they believe the plans would involve Saudi Aramco’s non-core, ancillary operations and not the Kingdom’s key oil and gas facilities.
The ministry said the new firm’s capital was divided into 10.66 million shares with a value of SR50 each.
“Founders subscribed for all the shares and paid the capital in full,” said the statement carried by the Saudi Press Agency.
It said shares would not be traded before the company posted profits for two years. It gave no more details.
Officials have said that majority ownership would come courtesy of the Saudi private sector, while the government would participate via two existing oil services companies.
Under Saudi corporate law, overseas firms cannot invest in joint stock companies but would be allowed to form joint ventures with subsidiaries of the holding company.
Petroleum and Mineral Resources Minister Ali Al-Naimi first unveiled the plan to set up the energy services firm in 2001. It would be similar, but not identical, to industrial giant Saudi Basic Industries Corp (SABIC).
