Case Study Of Saudi Aramco

Currently Saudi Arabia is one of the leading producers of oil in the world. However, it is losing its foothold on the market. Many countries, like North America, are increasing their oil production and are looking for ways to become less dependent on foreign oil. The increased competition has caused oil prices to decrease. By producing their own oil, countries not only will increase their revenues, but will also reduce their need to rely on foreign oil. By reducing their need foreign an oil a country does not have to worry that their oil supply will be cut off if they go to war.

Saudi Aramco is ranked first amongst all oil companies worldwide in terms of crude oil production and exports, and NGL exports. In addition they are amongst the worlds leading producers of natural gas with 288.4 trillion standard cubic feet of gas reserves. The products that Aramco specialise in are petroleum, natural gas and other petrochemicals. “We rank first among oil companies world wide in terms of crude oil production and exports, and natural gas liquids (NGL) exports and are among the leading producers of natural gas” (http://www.aramco.com/en/home/about/at-a-glance.html)

Saudi Arabia has made tremendous milestones in claiming its deserved position as a renowned world economy. In its bid to take its place among the club of the world’s largest economies, Saudi Arabia has had to make numerous economic development activities since the 1970s. First and foremost was the elevation of the oil mining status to the largest oil reserves or mining countries of the world. Huge amounts of revenue from the sale of oil boosted the establishment of various projects that the country had much desired. The Oil reserves became the countries single largest source of revenue that would drive the country from the underdeveloped sphere to the doorstep of the wealthiest nations. The government of Saudi Arabia has set the development of the country’s economy since the 1970s to conform to a predetermined five-year plans starting with the year 1970-1975 (Al Mallakh & el Mallakh, 2015). These are set as a focus on the long-term goals of the economy set out as achievable goals within a five-year implementation process.This has led to massive economic developments of the country throughout the ages; some of the milestones that the country has made economically are as discussed.

The largest world supplier oil company is Saudi Aramco. It is the most profitable company on the earth. Since it is the most powerful oil company, it has a great impact on the world economy. As a result, a strong international relationship was built with the Kingdom of Saudi Arabia. In addition, the strong developing of international relationship with other industrial countries resulted in massive contributions to the politics, economy, and many different aspects. In 1933, Saudi government bestowed oil concession to California Arabian Standard Oil Company (Chevron). The main factor for this grant was to explore the oil in the eastern region of the Kingdom of Saudi Arabia. After discovering a huge amount of oil, part of the

Oil was found at Masjed Soleyman in southeastern Iran on May 26, 1908, and three years later was piped down to a newly built refinery at Abadan on the Iranian side of the Shatt-Al-Arab, not many miles below Basra.1(Stephen, 1991) Its global importance eas immediately recognized, not just by the Admiralty in London, looking for new sources of supply for its oil-fired battleships, but in other European capitals as well leading to a brief British-German-Turkish skirmish for control of the pipeline at the start of World War 1.2(Wilfred, 2007) Oil was next found in the Persian Gulf, beginning with Bahrain in 1931; there were subsequent discoveries in Kuwait, Qatar, Saudi Arabia, the Trucial states, and Oman. By 1960 the smaller Gulf states were producing 15 percent of the world 's oil, with another 10 percent or so coming from Iraq and Iran.3(Longrigg, Oil in the Middle East) By 1970 this had risen to 30 percent.4(BP Statistical Review, 2006) The story of the discovery, exploitation, and importance of Middle Eastern oil has been told in many different ways, and from many different points of view. For some it has been a source of Western triumphalism as in the case of the Aramco story , in which brave Texas "pioneers" conquer the world 's last oil frontier.5(Wallace, 1971) For others, like the Arab novelist Abad Al-Rahman Munif, it is a tale of woe, as the lives of nomadic people are disrupted by the appearance of prisons and exploitative local officials.6(Cities of Salt, 1989)

Saudi Arabia is one of the most conservative Islamic states. The Islam is the religion that dominates all aspects of the citizen’s lives. The Islamic interpretations effects the politics, economics, businesses, and communications with other nations. For instance, Saudi Arabia and The United States have different views

Company overview: The Saudi Arabian Oil Company (Saudi Aramco) is a government-owned entity (since 1988 fully government-owned) and the world’s largest oil company in terms of output and managed natural crude oil resources. The company specializes in the exploration, production and distribution of crude oil, petrochemicals and natural gas. Saudi Aramco was established 1933 when Saudi Arabia signed a concession agreement with Standard Oil of California to explore for oil in the country. The group has more than 55,000 employees, circa 500 of which are Canadians. The company is headquartered in Dhahran. Plants are established in Abqiq (near Jeddah),

The strategy would be to expand into the already lucrative Macau casino market with one of the most successful casino/resort in the Las Vegas area, the Bellagio. MGM already has a foothold hold in Macau Market, which is provided due to a partnership with Pansy Ho and the successful MGM Macau. The main competition in this area is: Las Vegas Sands Corp. (LVSC), which have 7 properties in the Macau area, Galaxy Entertainment Group (GEG), which have 3 properties and Wynn Resorts Ltd. (WYNN), which have two.

Saudi Arabia is in possession of vast quantities of crude oil, currently larger than the US. [2] Due to the ease of access for Saudi Arabia to extract their oil, they have much lower production costs, giving them the flexibility to sell their oil at much lower prices. [3] This has forced many international oil companies to match these low prices to stay competitive. As other companies are not able to produce oil at such low prices they are forced into smaller profits, making extraction more costly. [4]

Saudi Aramco hospital is a big health organization it consist of a lot of departments and have around 18000 health staff having a different professional., also Aramco hospital serve around 30000 patient all are Saudi Aramco oil company employee and their families.

This unitary Islamic absolute monarchy “possesses 18 per cent of the world’s proven petroleum reserves and ranks as the largest exporter of petroleum” (OPEC, 2015), also is a member of the Organization of Petroleum Exporting Countries. The oil production is responsible for about 50% of the Gross Domestic Product, and about 85% of export earnings (OPEC). Although it is the world’s greatest exporter, its GDP per capita is only $24,454. Saudi Arabia ranks weakly on the Human Development Index as number 59 of the 182 states in the world, and it is only number 8 between the other MENA countries. Although Saudi Arabia’s elite is very wealthy and large, a great portion of the population barely receives profits from the state's wealth. It is ranked as not free relating to civil liberties and also ranked as suffering hard from corruption. Also, the political parties in Saudi Arabia are banned, and political organizations that oppose may only exist outside the country (Freedom House, 2015). Even before the discovery of oil, the family that was in power depended on the merchants of Jeddah, a Saudi Arabian city, to collect their taxes. When oil was discovered in Saudi Arabia, that is when the country started to develop, just like the United Arab Emirates. It can be said that if a country has strong institutions, stable economy, and a flexible political system, they

With the assurance of those agreements, the United States began to provide the best petroleum engineers and to rev up its involvement in the ME. After the discovery of oil in the Arabian Gulf, and the deal made with King Ibn Saud of Saudi Arabia to establish the Arabian-American Oil Company (today known as Saudi Arabian Oil Company or simply Aramco) which is nowadays its value has been estimated at anywhere between US$1.25 trillion and US$7 trillion,making it the world's most valuable company, the United States felt that it had an even greater stake in the region. Today, Aramco, one of the biggest oil companies in the world, is fully controlled by the Saudi Arabian government but the USA continues to be committed to the oil industry in Saudi Arabia and the ME; that commitment is also related to the United States’ support of

Saudi Arabia has an economy that is largely dependent on oil, with the government maintaining the biggest control over the country 's significant economic activities. Saudi Arabia owns about 16% of the global oil reserves and is the number one exporter of oil (Saudi Arabia, 2013). In addition, the Kingdom of Saudi Arabia was instrumental in the formation of the OPEC (Organization of the Petroleum Exporting Countries) group, which initially comprised Iraq, Venezuela, Iran, Kuwait and Venezuela (Energy indicators, 2004). Currently, the petroleum industry constitutes about 80% of the country 's budgetary incomes; about 40% of the country 's GDP and 87% of Saudi 's export earnings. Agriculture, in addition to petroleum products, has been a major contributor to the kingdom’s economy since 1970s (Saudi Arabia, 2013). The country has been able to produce enough agricultural products for their consumption as well as surplus for exportation to the GCC member countries.

1. Evaluate the economics of Gulf's exploration and development program in net present value terms. How do Gulf's outlay for exploration and development compare to cash returns Gulf generates from these activities.

Saudi Arabia has an oil-based economy. Shipments of oil account for 87 percent of total exports and for 46 percent of GDP. In recent years, in order to diversify the economy, the government has been investing in telecommunications, petrochemicals, natural gas exploitation and power generation sectors.