12 May 2017, Riyadh — Oil giant Saudi Aramco [IPO-ARMO.SE] is close to selecting a partner for a joint venture it plans to set up to oversee government-related infrastructure projects in Saudi Arabia, sources familiar with the matter said.
U.S.-based Jacobs Engineering is believed to be the frontrunner to be a partner in the JV, while the Saudi sovereign wealth fund, the Public Investment Fund (PIF), is also expected to be involved, the sources told Reuters. They did not wish to be identified because the information is not yet public.
Aramco, which is preparing for what is expected to be the biggest IPO in corporate history, is involved in projects across sectors, not just oil, and the new company will provide project management services on infrastructure and non-oil related projects, according to the sources.
Saudi Aramco, Jacobs, and the PIF all declined to comment.
An announcement on the joint venture is due to be made on May 20, one of the sources said, which would coincide with U.S. President Donald Trump’s planned visit to Saudi Arabia.
The Saudi government, whose revenues have been hit by low oil prices, has been seeking to cut costs on state infrastructure projects. In February it appointed U.S.-based Bechtel Corp to set up and run a new National Project Management Organization (NPMO), known in Arabic as Mashroat, tasked with reducing inefficiencies on such projects.
Saudi Aramco’s non-oil projects have included building the Al-Jawhara football stadium in Jeddah, managing floodwater drainage projects in Jeddah and it is currently building an economic city in Jizan in southern Saudi Arabia.
*Reem Shamseddine; Editing: Susan Fenton – Reuters