Saudi Aramco earmarks $500 bln for 10-year expansion plan

State-run Saudi Aramco plans to invest $500 billion over the next ten years, including $160 billion for natural gas developments and $100 billion for chemicals projects, Bloomberg reported, citing chief executive officer Amin Nasser.

The spending would be in addition to the oil giant's proposed purchase of a majority stake in SABIC, the Middle East’s largest chemical business - a deal valued at about $70 billion.

“We need a major acquisition for us to be in different markets quickly,” Nasser said, adding that “it makes sense for Aramco to acquire a company of its size.”

In July, Aramco confirmed it is in talks with the Public Investment Fund (PIF), the Kingdom’s sovereign wealth fund, over the acquisition of a potential stake in SABIC, which currently operates in more than 50 countries.

According to Nasser, Aramco expects to conclude negotiations with the PIF "soon” and “all financial instruments are on the table” for funding it.

Additionally, the oil major plans to more than double its refining capacity by the middle of the next decade as it seeks to convert three million barrels of crude a day - about 30 percent of its daily output - into chemicals.

“You can absorb market volatility when you are balanced between upstream and downstream. This is where our strategy is going,” Nasser noted.

Demand for oil is healthy and will remain the same next year in terms of additional demand, he added.