Energy giant Aramco to issue longer term bonds this year, CFO tells Saudi Capital Market Forum in Riyadh

Aramco is trying to optimise its capital structure, chief financial officer Ziad Al-Murshed tells gathering

‘Now the markets are becoming more stable, so you can expect us to be active’: CFO

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An Aramco oil facility in Jiddah, Saudi Arabia, is seen in this file photo from March, 2021. Photo: AP

Published: 10:07pm, 19 Feb 2024

Energy giant Saudi Aramco is poised to issue bonds this year with tenures of 15 to 50 years in a bid to optimise its capital structure, Ziad Al-Murshed, the company’s chief financial officer (CFO), said at the Saudi Capital Market Forum in Riyadh on Monday.

“We have been active [in issuing bonds] in the past,” he said. “There was a period of inactivity because the markets were not stable. Now the markets are becoming more stable, so you can expect us to be active.”

Aramco will prioritise longer term over short-term bonds for the issuance, which is likely to take place this year, he added.

The energy giant is among the largest companies in the Middle East tracked by the CSOP Saudi Arabia exchange-traded fund (ETF), Asia’s first Saudi Arabian ETF that made its debut in Hong Kong last November in a milestone listing, signalling stronger ties between the two region’s financial markets.

“What we’re trying to do is optimise our capital structure,” Al-Murshed said. “Overall, we’re in a significant net-cash position. What we’re trying to do is get to a more optimum capital structure, which means considerably more debt, but we look at this over the cycle and not just year by year.”

Al-Murshed pointed out that “it’s not good to borrow to pay dividends”, and that the company is “extremely fiscally disciplined” when it comes to funding capital programme opportunities.