Saudi Aramco keeps focus on raising production capacity as profits surge

Saudi Aramco keeps focus on raising production capacity as profits surge

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Saudi Aramco is using the rise in oil prices to reduce leverage and invest in increasing production capacity, bucking the trend among international rivals to raise returns to shareholders.

The state-backed oil company, which listed a sliver of its shares in 2019, maintained its dividend at $18.8bn in the second quarter even as net income almost quadrupled from the same period last year to $25.5bn. Oil prices recovered to more than $70 a barrel in the quarter.

Analysts had expected net income of about $24.7bn for the quarter.

Amin Nasser, Saudi Aramco’s chief executive, indicated that while the dividend could be increased in the future, the world’s largest oil producing company saw an opportunity to increase its maximum output capacity.

Many western oil majors expect their own production to decline over the coming decade, partly under pressure from governments and investors to cut emissions and invest more in renewable energy.

“Seeing that there is a lot of under-investment in [oil] supply it’s a great opportunity for us,” Nasser said on Sunday. “We are diligently working to increase capacity.”

The company is about two years away from completing the planning and design