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Saudi Arabia’s state-owned oil company has paid out nearly $100bn (£77bn) in dividends as Crown Prince Mohammed bin Salman looks to fund ambitious plans to build a “mirror city” in the desert. Ta.
Saudi Aramco, the world’s biggest oil producer, has increased its dividend by 30% to $98bn in 2023, despite a 25% fall in profits to SAR 454.7bn (£94.29bn). did.
The company indicated on Sunday that dividends distributed to investors and the Saudi government will further increase in 2024. This comes after the OPEC+ cartel, led by Russia and Saudi Arabia, extended oil supply cuts earlier this month as part of an oil supply boost. price.
The dividend would be a boost for Crown Prince Mohammed bin Salman (MBS), who has spent hundreds of billions of dollars on outlandish projects to diversify the economy away from oil and faces a widening budget deficit.
Riyadh is forecasting a budget deficit every year until 2026, and authorities are pushing back the schedule of so-called gigaprojects included in the Vision 2030 transformation plan.
Earlier this week, Saudi Arabia transferred an 8% stake in Aramco worth $163.6 billion to its sovereign wealth fund, increasing the state’s ownership of the oil company.
Aramco shares are the main source of income for MBS’s diversification efforts.
The ambitious project includes MBS’s plans to build a futuristic mirrored skyscraper called the Mirror Line that will stretch 125 miles across the desert.
The proposed megacity would be the world’s largest building, designed to house 5 million people, and include its own high-speed railway, sports stadium, and vertical gardens where vegetables would be harvested by robots. .
The sci-fi construction project, expected to cost about $1 trillion, has no set completion date, but experts say it could take up to 50 years.
Mirror Line is just one part of MBS’s $500 billion Neom development project. Neom is a large-scale urbanization project aimed at promoting tourism and attracting foreign investment.
Other costly diversification projects include spending billions on sports deals that bring soccer, cricket and golf to Saudi Arabia through the controversial LIV Tour.
Saudi professional soccer clubs spent a record $957 million last summer poaching high-profile soccer players from international rivals, according to Deloitte.
That includes Manchester United’s Cristiano Ronaldo, who became the highest-paid footballer in history when he signed a £173m-a-year deal with Saudi Arabia’s Al-Nassr.
Last year, Saudi Arabia also acquired a fleet of 72 Boeing jets for Riyadh Airways, an upstart airline that rivals the United Arab Emirates’ (UAE) Emirates, Abu Dhabi’s flag carrier Etihad Airways, and Qatar Airways. spent £30 billion on
Saudi Arabia’s sovereign wealth fund spent $31.5 billion on a variety of investments last year, including a deal to take a 10% stake in Heathrow Airport, more money than in any other year.
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