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Tuesday, April 17, 2018

Can Saudi Arabia Afford All Those Mega-Billion-Dollar Projects? -- Oilprice.Com -- April 17, 2018

Link here. Data points:
  • Saudi Arabia's sovereign wealth fund
    • plans to expand to $400 billion by 2020 but right now: US$250 billion
  • Saudi Arabia 2018 budget
    • deficit of US$52 billion
    • oil price target: US$80 / bbl
  • available foe mega-projects
    • $2 trillion Saudi Aramco valuation
    • IPO, at 5%: US$100 billion
    • plus the sovereign wealth fund, results in total of US$350 billion
    • that leaves $33 billion short for the mega-projects planned by Prince Salman
  • Financial Times:
    • oil needs to be trading at $120/bbl for Saudi Aramco to be valued at US$2 trillion
    • at a price of US$64/bbl, Aramco would be worth just US$1.1 trillion
  • the six mega-projects
    • Neom city project and the Softbank deal (solar project): US$700 billion
    • another smart city for Egypt: US$7 billion
    • refinery deal with three Indian companies: US$44 billion
    • refinery project in Malaysia: US$7 billion
    • petrochemicals complex in Saudi Arabia; US$5 billion
  • total: US$766 billion

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