Aramco will retain a 51% majority stake in JMGC, while the remaining 49% will be owned by investors headed by GIP. The deal will be closed once all the standard conditions are met.
Aramco announced on Thursday that it has signed an $11 billion lease and leaseback agreement for its Jafurah gas processing plants with a consortium of global investors, led by Global Infrastructure Partners (GIP), an affiliate of BlackRock, which will provide funding and take a share in the project’s income.
Jafurah is the Kingdom’s largest non-associated gas development. It is estimated to contain 229 trillion standard cubic feet of raw gas and 75 billion stock tank barrels of condensate, a product of condensation.
The field plays a crucial role in the company’s goal to increase its gas production capacity by 60% from 2021 to 2030.
As part of the deal, a newly formed subsidiary, Jafurah Midstream Gas Company (JMGC), will lease development and operational rights for the Jafurah Field Gas Plant and the Riyas NGL Fractionation Facility, and then lease them back to Aramco for a period of two decades, according to a press release from Aramco.
JMGC will get a tariff from the company in exchange for exclusive rights to process raw gas from Jafurah.
Aramco will retain a 51% majority stake in JMGC, while the remaining 49% will be owned by investors headed by GIP. The deal will be closed once all the standard conditions are met.
Amin H. Nasser, President and CEO of Aramco, stated that as Jafurah prepares to commence phase one of production this year, other subsequent phases are also well on track. He emphasised the importance of Jafurah playing a crucial role as a feedstock provider to the petrochemicals industry and its contribution to supplying the energy needed to power emerging growth sectors, such as AI data centres in the Kingdom.
This deal shows that there is a growing trend among the region’s national oil companies to make money from oil and gas infrastructure through long-term leaseback models while retaining operational control.
In September 2024, the fund managed by BlackRock purchased a minority share in the Saudi-Bahrain Pipeline Company (SBPC) from Bapco Energies. The 112-km pipeline sends crude oil from Saudi Aramco to Bahrain’s national refinery.
In December 2021, Aramco entered into a $15.5 billion lease and leaseback agreement involving its gas pipeline network with a consortium led by BlackRock and Hassana. It was the investment management division of the General Organisation for Social Insurance (GOSI) in Saudi Arabia.
The Aramco Gas Pipelines Company, where Aramco owns 51% and the remaining 49% is owned by investors led by BlackRock and Hassana, has leased rights to operate within Aramco’s gas pipeline network and leased them back to Aramco for a period of 20 years.
In return for the gas products that will flow through the network, Aramco Gas Pipelines Company will get a tariff from Aramco, with a minimum commitment on throughput, guaranteeing the arrangement.
In 2019, ADNOC made a $4 billion deal with a group that included GIC, BlackRock, KKR, and the Abu Dhabi Retirement Pensions and Benefits Fund, in which it sold a 49% stake in its subsidiary, ADNOC Oil Pipelines (AOP).
Under the deal, AOP will lease ADNOC usage rights for 18 pipelines used for transporting crude and condensates from the national oil company’s onshore and offshore concessions, leasing them to ADNOC for 23 years.
In April 2024, the local alternative investment company Lunate acquired a 40% stake in AOP from BlackRock and KKR, and subsequently purchased an additional 6% stake from Snam in January 2025, bringing the infrastructure under the ownership of the United Arab Emirates (UAE).
