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43 min ago 3 min read
One of the curiosities of Saudi’s energy arsenal is the lack of an LNG import or export terminal. But that may be about to change.
State-owned Saudi Aramco is planning to create a new gas business which would allow it to develop its natural gas resources domestically while continuing to strengthen its LNG portfolio abroad, according to a Reuters report.
Aramco has studied building flexible, two-way terminals, potentially on the Red Sea near Yanbu or the Gulf coast, to handle imports during peak domestic demand and future exports as the massive Jafurah gas field is developed, where the second phase is due to start in 2027. When fully developed, it could be producing as much as 2 bcf a day by 2030.
The Middle East conflict has provided renewed focus domestically and internationally.
Cementing links with global LNG markets is clearly a way to circumnavigate regional transit chokepoints – which in Saudi’s case, are rising on either side, both from the and .
Another major challenge has been the East-West pipeline, which was attacked and damaged with drones by Iran-backed militias, forcing Saudi Aramco to shut it down, although latest reports are that it has reopened.
How these risks can be reconciled will be key to the implementation, and future viability, of any new infrastructure plans. But even in a deteriorating scenario, Aramco can play a strong international card.
Aramco’s involvement in US LNG is already extensive. It holds a 49% stake in , and long-term agreements with and . Its cumulative LNG offtake could rise to as much as 3.2 million tonnes per annum (mtpa) by 2030.
The US was already ramping up prior to the Middle East conflict. Just under 90 mmtpa of US LNG took final investment decision [FID] in 2025 and 2026. But the war has sent activity into overdrive.
Since March, two major US LNG projects have reached FID – Commonwealth LNG and – representing a combined capacity of approximately 1.9 bcf/d.
US energy company Caturus plans through a five-train expansion at its Commonwealth LNG export facility in Cameron Parish, Louisiana.
Aramco has been expanding its LNG portfolio with around 4.5 to 7.5 mtpa in active supply agreements and project stakes, while targeting an ultimate capacity of 20 mtpa.
There is a disconnect though, between today’s crisis and tomorrow’s risk of oversupply, which creates uncertainty for both sellers and buyers and makes pricing contracts challenging.
How buyers, sellers, portfolio players and governments build commercial models to adapt to the ‘new reality’ remains key, believes research firm Wood Mackenzie, reflecting on dynamics at the recent edition of in Bangkok.
“Whichever way the relationship-versus-transactional pendulum swings, careful portfolio construction that diversifies risk via geography, tenor and basis will support the growth the industry requires – limiting risk for consumers, financiers and companies alike – while underpinning the world’s growing energy needs,” it notes.
