Aramco Subsidiary Absorbs Motiva Trading

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Aramco Subsidiary Absorbs Motiva Trading
Aramco sign on a corporate office building in Houston, Texas. ©JHVEPhoto

Saudi Aramco announced Jan. 18 that Houston-based Aramco Trading Americas LLC will be the sole supplier and “offtaker” of Motiva Enterprises – owner of the Port Arthur, Texas refinery and base oil plant – following the 100% acquisition of Motiva Trading by Aramco Trading Co. However, Motiva Enterprises will continue to market and sell Aramco-branded base oils in the Americas, the company confirmed to Lube Report.

Aramco’s news release did not explain specifically what it means by offtaker. A Motiva spokesman referred questions to Aramco, which did not respond to a query from Lube Report.

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Aramco Trading Americas LLC is a wholly-owned subsidiary of Aramco Trading Co. Motiva Enterprises – wholly owned by Saudi Aramco since 2017 – operates North America’s largest fuels refinery, which can process 630,000 barrels of crude oil per day. The refinery includes a 40,300 barrels per day Group II and III base oils unit.

Motiva Enterprises remains a separate Aramco affiliate, and its Port Arthur, Texas, refinery and base oil operations and sales are not impacted by the transaction, the company said.

In June 2022, Reuters reported that Aramco Trading planned to absorb Motiva Trading ahead of a possible initial public offering of the business. Reportedly, the move to combine the businesses was expected to give potential investors a better sense of the scale of Aramco’s trading and would also allow the state oil producer to simplify financial reporting and cut duplication.

Aramco Trading Americas will be ATC’s regional office, expanding its trading business in North and South America to capture new opportunities and increase its existing customer base.

“The acquisition of Motiva Trading and the establishment of Aramco Trading Americas are a giant step towards executing our ambitious global growth strategy, which aims to expand our geographical reach and scale of operations, while further strengthening our product flexibility and optionality,” ATC President and CEO Mohammed K. Al-Mulhim said in a news release.

According to its website, Aramco Trading Co. has to this point focused on trading crude oil and condensate, liquid natural gas, liquid propane gas, naphtha, gasoline, jet and diesel fuels, fuel oil, sulfur, petcoke and chemicals.

Saudi Aramco, the world’s largest oil company, has been busy in recent years with major acquisitions and an initial public offering.

In August 2022 Aramco announced a $2.7 billion deal to acquire U.S. blender Valvoline’s Global Products business, which is its lubricant and maintenance product sales segment. That deal is expected to close early this year.

Aramco owned 50% of Motiva before buying the other half from Shell in 2017.

Aramco owns 70% of Luberef, formally named Saudi Aramco Base Oil Co. Jadwa recently sold the other 30% in an initial public offering for Luberef. Base oil plants in Jeddah and Yanbu’ al Bahr, Saudi Arabia.

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