WASHINGTON DC.
Saudi Aramco, the world’s largest oil company, is in advanced talks to sell a roughly $10 billion stake in the midstream infrastructure of its Jafurah natural gas project to a consortium led by BlackRock Inc., through its Global Infrastructure Partners (GIP) unit, according to sources familiar with the matter. The deal, which could be finalized in the coming days, underscores Saudi Arabia’s strategic push to diversify its energy portfolio and attract global investment as part of its Vision 2030 economic transformation plan.
The Jafurah gas field, located in eastern Saudi Arabia, is one of the largest unconventional shale gas projects outside the United States, with an estimated 229 trillion cubic feet of raw gas and 75 billion barrels of condensate. Valued at over $100 billion, the project is central to Aramco’s goal of increasing its natural gas production by 60% by 2030 compared to 2021 levels. The infrastructure in question includes pipelines and a gas processing plant critical to supplying domestic power plants and supporting export markets.
The Jafurah field is expected to begin production in late 2025, ramping up to a sustainable output of 2 billion cubic feet per day by 2030, alongside significant volumes of ethane, natural gas liquids (NGL), and condensate. These resources are vital for Saudi Arabia’s petrochemical industry and its transition toward a lower-emission energy mix, with natural gas positioned as a “bridge fuel” to displace oil and coal in power generation.
The potential $10 billion transaction is expected to follow a lease-and-leaseback model, similar to Aramco’s 2021 deals with BlackRock and other investors. In those agreements, Aramco sold 49% stakes in its oil and gas pipeline subsidiaries for a combined $28 billion, retaining operational control and a 51% stake while paying investors tariffs for pipeline usage. This structure ensures steady cash flows for investors, backed by minimum throughput commitments, while allowing Aramco to raise capital without relinquishing ownership of critical assets.
The BlackRock-led consortium, supported by GIP, is poised to acquire a minority stake in the Jafurah midstream assets, which include approximately 1,500 kilometers of pipelines and related facilities. This deal aligns with Aramco’s broader strategy to monetize its infrastructure to fund ambitious projects, including futuristic cities like NEOM and investments in low-carbon energy sources such as hydrogen and renewables.
For Saudi Arabia, the deal is a key step in diversifying its economy amid fluctuating oil prices and global economic uncertainty. With oil prices hovering near $70 per barrel in 2025 and OPEC+ increasing production to capture market share, Aramco faces pressure to streamline its finances. The company’s debt has risen to $36 billion, partly due to its $69 billion acquisition of SABIC in 2020. Selling infrastructure stakes allows Aramco to free up capital for growth initiatives while maintaining control over its energy assets.
For BlackRock and GIP, the investment offers a stable, long-term revenue stream in a volatile energy market. Infrastructure assets like pipelines are attractive to institutional investors due to their predictable cash flows and resilience to commodity price swings. BlackRock’s involvement also reflects its strategic balancing act: maintaining exposure to traditional energy while facing pressure from ESG (Environmental, Social, and Governance) investors to pivot toward greener projects. A 2021 memorandum of understanding between BlackRock and Aramco to explore low-carbon energy infrastructure suggests this deal could be a bridge to future collaborations in sustainable energy.
The Jafurah deal highlights broader trends in the global energy sector. Gulf countries like Saudi Arabia and the United Arab Emirates are increasingly opening their energy infrastructure to international investors to fund economic diversification. For instance, Abu Dhabi’s ADNOC has pursued similar pipeline stake sales, with sovereign entities later reacquiring some assets to consolidate control. These transactions reflect a delicate balance between leveraging foreign capital and maintaining strategic oversight of critical infrastructure.
Moreover, natural gas is gaining prominence as a transitional fuel in the global push toward net-zero emissions. While renewables like solar and wind are growing, gas remains essential for stable power generation, particularly in industrializing economies like Saudi Arabia. The Jafurah project’s focus on gas aligns with the kingdom’s Vision 2030 goals of reducing oil dependency, boosting domestic industrialization, and developing high-value sectors like petrochemicals and hydrogen.
Despite its promise, the deal faces challenges. Geopolitical risks, such as tensions in the Middle East and OPEC+ dynamics, could impact investor confidence. Additionally, ESG scrutiny may pressure BlackRock to justify its investment in fossil fuel infrastructure, even if natural gas is marketed as a cleaner alternative to oil and coal. On the opportunity side, the Jafurah project’s scale and Saudi Arabia’s stable regulatory environment make it an attractive bet for long-term investors.
As Aramco and the BlackRock-led consortium near an agreement, the Jafurah pipeline stake sale could set a precedent for future infrastructure deals in the region. For Saudi Arabia, it’s a chance to bolster its position as a global energy leader while funding its vision for a diversified economy. For investors, it’s an opportunity to tap into a high-growth sector with stable returns. As the energy transition accelerates, deals like this will shape the future of global energy markets, bridging the gap between today’s fossil fuel realities and tomorrow’s sustainable ambitions.
