Saudi Arabia Signs $27.69 Billion Energy Deals to Boost Global Leadership
Saudi Arabia has signed 107 strategic agreements and memorandums of understanding, aimed at reinforcing its global leadership in the energy sector. These agreements involve 117 public and private entities.
Major Energy Deals Announced
According to the Saudi Press Agency (SPA), deals valued at SAR 104 billion were announced at the Energy Localization Forum. The forum was titled “Resilient Energy: Enabling Energy Sector Capability and Sustainability” and focused on energy sector development. Prince Abdulaziz bin Salman, the Minister of Energy, inaugurated the significant event attended by key industry leaders. Notable attendees included Dr. Hamad bin Mohammed Al Sheikh, Minister of State, and Bandar bin Ibrahim AlKhorayef, Minister of Industry and Mineral Resources.
Vision 2030 and Energy Localization
In his opening remarks, Prince Abdulaziz emphasized the significance of energy localization in line with Saudi Vision 2030. He noted that the energy sector plays a crucial role in driving industry and development in Saudi Arabia, contributing nearly 40% to the country’s GDP.
Localization, he explained, is essential for ensuring long-term sustainability and security in the energy sector. He urged other sectors of the economy to adopt similar localization strategies.
Highlighting Key Programs
Prince Abdulaziz pointed out several localization initiatives, including Aramco’s In-Kingdom Total Value Add (iktva) program, SABIC’s Nusaned program, and the Saudi Electricity Company’s Bina program. These programs are vital for ensuring that a significant portion of the energy supply chain remains within Saudi Arabia.
Lessons from the Pandemic
The Minister also discussed how the Covid-19 pandemic revealed vulnerabilities in global supply chains, particularly for essential commodities. In response, Saudi Arabia quickly coordinated local production efforts with 15 key entities to secure vital supplies. This experience, he said, highlighted the importance of localization across all sectors, especially energy.
Crown Prince’s Directives
Prince Abdulaziz also referred to directives from Crown Prince Mohammed bin Salman to tackle supply chain gaps. These include a comprehensive study on how to bridge such gaps and strengthen local production. The Energy Sector Localization Committee has set short and long-term goals, with a target to localize 75% of the energy sector by 2030.
Comprehensive Localization Strategy
“We are not just focusing on local content,” said Prince Abdulaziz. “Our strategy aims to localize the entire supply chain, from raw materials to final products, ensuring the transfer of technology and maximizing local value.”
This comprehensive approach underscores Saudi Arabia’s commitment to securing a sustainable energy future while fostering economic growth through localization.