Saudi Arabian Oil Co. · TADAWUL:2222
Saudi Arabian Oil — Saudi Aramco — FY2021 Earnings Presentation
24 slides from Saudi Arabian Oil's earnings presentation, Mar 21, 2022
Slide 1: 2021 Results
&agaull gobi Ba saudi aramco 2021 Results March 21, 2022
Slide 2: Cautionary notes
Cautionary notes This presentation may contain certain forward-looking statements with respect to Aramco’s financial position, results of operations and business and certain of Aramco’s plans, intentions, expectations, assumptions, goals and beliefs regarding such items. These statements include all
Slide 3: Amin Nasser, President & CEO
Amin Nasser President & CEO Saudi Aramco FY 2021 Results | ‹#› Saudi Aramco: Company General Use
Slide 4: Volatile and uncertain market outlook
Volatile and uncertain market outlook Brent oil price ($/bbl) 135 140 110 130 125 120 115 Global oil demand1 110 105 (mmbpd)2 100 95 90 100 120 85 80 120 75 70 65 100 60 55 100 50 45 90 40 80 35 80 30 25 20 15 60 10 60 5 0 80 40 40 20 20 00 0 H1 19 H2 19 H1 20 H2 20 H1 21 H2 21 H1 22 H2 22 Actual Fo
Slide 5: Significant under investment in supply
Significant under investment in supply Oil supply outlook1 Global oil capital spending3 mmbpd2 $Bn 120 700 106 100 600 New investment required Estimated capex 80 Global supply with current required to meet level of spending 500 forecast 2030 demand Average 60 2010-21 capex 400 40 Estimated capex req
Slide 6: Our strategy
Our strategy Upstream Downstream The world’s largest • Pre-eminence • De-risk upstream integrated energy and • Capturing supply position chemical company, gap opportunity • Integration operating in a safe, reliable and sustainable manner Low-carbon Localization • Solutions for the • Reliability ener
Slide 7: Upstream: Maximizing value
Upstream: Maximizing value Crude oil increments Growing MSC1 to 13mmbpd by 2027 Zuluf 600 mbpd 4 by 2026 mmbpd2 Marjan 300 by 2025 mbpd 13 MSC1 Berri 250 by 2025 mbpd 12 11 10 Crude oil production3 Dammam 25 mbpd by 2024 9 50 mbpd by 2026 8 7 2019 2020 2021 2022 2023 2024 2025 2026 2027+ 1. MSC = Ma
Slide 8: Upstream: Maximizing value
Upstream: Maximizing value Potential to expand gas production by more than 50% by 2030 • Mix of conventional and unconventional (e.g. Jafurah) • Expanding gas storage • Significant quantities of high-value liquids • Domestic emissions reduction • Displacement of liquid burning & increase liquids ava
Slide 9: Downstream: De-risking Upstream & capturing additional value
Downstream: De-risking Upstream & capturing additional value Growing liquids to chemicals • De-risks Upstream position through alternative uses of oil • Long-term goal of up to 4mmbpd1 • In-Kingdom and key export markets • Reduces emissions • Captures value from integration into chemicals Performanc
Slide 10: Strong position for a lower-carbon future
Strong position for a lower-carbon future • Ambition to achieve Net Zero by 20501 • Upstream carbon intensity: one of the lowest in industry2 • Aiming for near zero Upstream methane emissions by 20303 • Aiming to become global leader in CCS4 • Investing in renewables • Investing in nature-based solu
Slide 11: Critical role for reliable, affordable energy with lower emissions
Critical role for reliable, affordable energy with lower emissions Reliable, secure, lower carbon, Environmental stewardship Increased investment to and affordable energy support energy transition • One of world’s • Net-zero 2050 GHG ambition4 • Developing significant hydrogen export capability – Lo
Slide 12: Ziad Al-Murshed, CFO
Ziad Al-Murshed CFO Saudi Aramco FY 2021 Results | ‹#› Saudi Aramco: Company General Use
Slide 13: A year of achievements
A year of achievements Upstream Downstream Corporate • Commenced development of vast • Started up Jazan refinery • Completed two major portfolio Jafurah unconventional gas field optimization transactions • Opened first branded in-Kingdom • Completed ‘Ain Dar & Fazran service station • Investment in
Slide 14: 2021 operational and financial highlights
2021 operational and financial highlights Operational Financial Hydrocarbon production Net income Capital expenditure 1 mmboed $Bn $Bn 12.3 110.0 31.9 FY 2020: 12.4 FY 2020: 49.0 FY 2020: 26.9 Crude oil production Free cash flow3 Dividends paid mmbpd2 $Bn $Bn 9.2 107.5 75.0 FY 2020: 9.2 FY 2020: 49.
Slide 15: Financial results: 2021 versus 2020
Financial results: 2021 versus 2020 $Bn, unless otherwise indicated 2020 2021 Key drivers Realized oil prices ($/bbl) 40.6 70.5 • Higher crude oil prices Hydrocarbon production (mmboed) 12.4 12.3 • Higher refining and chemicals Upstream EBIT 110.2 200.0 margins Downstream EBIT (5.4) 16.6 • Full year
Slide 16: Balanced value and growth
Balanced value and growth Value demonstrated over decades in existing asset base • One of world’s largest energy resources – 253.6 billion boe1 of reserves • Long-term focus – over decades not quarters • Resilience across industry cycles – proven in 2020 Unprecedented opportunities to grow • Economi
Slide 17: Investing for growth
Investing for growth 70 Capex1 ($Bn) Growing until middle of decade 60 • Increasing MSC2 to 13mmbpd3 Around 40-50 50 0.6 • Increasing gas capacity 40 0.3 • Growing liquids to chemicals 7.0 31.9 26.9 0.6 30 7.7 • Carbon Capture and Storage (CCS) 0.3 7.0 20 23.7 • Investment in hydrogen & 23.7 renewab
Slide 18: Financial flexibility
Financial flexibility Significant capability 1. Strong balance sheet: maintain high investment grade credit rating across cycles 2. Portfolio optimization 3. Expanding access to diversified sources of capital 4. Flexible elements of capex ‹#› Saudi Aramco FY 2021 Results | 18 Saudi Aramco: Company G
Slide 19: Cash flow allocation priorities
Cash flow allocation priorities $ Sustaining capex SR Sustainable dividend $ Growth capex Additional dividend and/or further debt reduction ‹#› Saudi Aramco FY 2021 Results | 19 Saudi Aramco: Company General Use
Slide 20: Robust dividend policy
Robust dividend policy Sustainable Progressive In line with future prospects and sustainable underlying growth in free cash flow ‹#› Saudi Aramco FY 2021 Results | 20 Saudi Aramco: Company General Use
Slide 21: 2021 shareholder distributions
2021 shareholder distributions $75bn cash dividend Board recommended • $4bn in retained earnings to be capitalized • Issuance of 1 bonus share for every 10 shares Signals • Confidence in future growth • Financial prudence in uncertain environment ‹#› Saudi Aramco FY 2021 Results | 21 Saudi Aramco: C
Slide 22: Growing future returns: strategy drives cash flow growth
Growing future returns: strategy drives cash flow growth Crude oil Gas Downstream Low carbon • Advantaged low-cost, • Growing domestic • De-risk Upstream • CCS3 low-carbon resource demand: >50% growth − Dedicated outlets base opportunity by 2030 − Liquids to chemicals • Blue hydrogen • Continued vol
Slide 23: Questions & Answers
Questions & Answers
Slide 24: Energy security for a sustainable world
Energy security for a sustainable world • One of world’s largest energy resources • Low cost1, low upstream carbon intensity2 • Investing for growth • Net-zero by 2050 ambition3 • Focus on technology & sustainability • Enabled by human capital 1. Low cost refers to lifting costs and upstream capex p