Oil Over Troubled Waters?

JFIF;CREATOR: gd-jpeg v1.0 (using IJG JPEG v62), quality = 80 C   %# , #&')*)-0-(0%()(C   ((((((((((((((((((((((((((((((((((((((((((((((((((( " }!1AQa"q2#BR$3br %&'()*456789:CDEFGHIJSTUVWXYZcdefghijstuvwxyz w!1AQaq"2B #3Rbr $4%&'()*56789:CDEFGHIJSTUVWXYZcdefghijstuvwxyz ?OZ1L4k3Af:U0i9❊+X.5 :kGul=Jj)ӕGh>&m@i2)WOs}8p_j܍&a`O2}^} w?XaXz_XfzT&GATm |8g2t ;XWi? _=d_) Ko)dXc4_%~xgǭJSf&{mvg"[ʲ;qU/β(ು]|eu _Z'=DVYSC UJU/o"Rzn*25+5)m?X,4_-|K]kna$1p7p>ڽjx5t<ژj 2:lC+)b+< Cc@?sϥy}(aVQNO4_hBM#TSu֦k!]nPLr?/$ehI+^ԯD{QiE?r6mcXq,ҟ x,j']7ÑϦiRI2 SWJKo *9=+ѡB/n\|a-Kx8*(GYUƚ!f@`dgy_O".t9Yp0,,VX:0F.6w{kOѼ 9_-ᕈ9 J{1cPTқzo?ӧQEV7Τcstz$45`ۡin{yQbAouC?H]f4 Zj?\UBouGBǟ}/­yFc\y?J4m-!^LБ"q !7e$p<=X{6] MmkLTY0T W=d_2N LO}i,:me-ċ\($+ΞYk:rHS_ W=d^K U%++n;\5"žf 0 +^nJU?׈U>"> F yHw %$dw~uʋR3xRQ"PWu 5Zi[hѡK(UKVRdO >A/쭤rlǩ*+ĐO6 a1*rFxš竀Q;#jx+F19Ľ=3]ßJ2qŎ79^B`J u\to9ZsƝhϝDOI aM{WS&hn&E8p+?C4Q{T+4*\Tp8O2* ^Yc^ՍqپTz j#M:KU0V;/Q0?m^{y|ܖ]am(am7?S_izp5(0vs{G??h4@.dΪ5"eFqգ8)(\ x^)MQR*GRS RS7$RRKh4LR8 ˩_h.)hAؔQJj J)Pii@(&)QK@b(( ZZ)@RL KL R)@"&#hR֤p4u4 ?ZƷo F8LTkR["$< o'r+gLQkkS[n-QrMyنx\Nh]Gf`7z&o侸K֍dtU!|0ub.Yrh'wHEU!$ (ν|]ZU9ZǝSM'POE>tVg'ºŴ9ⲚHuVH#kzE|X9>Wo6$u+!VH#8>kYZ:{ݴ[H6r(eaA)Q|!B{}FOq5y j9菞 Tnq$5V^*Mtx2;,p }+Kh ^5Vp+rS{ u_NA penUw昷cr`0_ o9 b$Iqޱver8H__gk[^畎vE@ylLBtG]|T(>ỷ(AC+BZ>;3wGOmn23rӜ{WU[_Y?mq6:Fb!Y{<-(4c^2I6z pz;#}+mcN>7},>|ugMl? G?#__XǍs_+~ ~p`~9]Vgٓz#e_+iKw}GR, ?l\l,{5kϯ(W^)}Bm ̦]i!Htk*+Е rȺ5Z<<#еK+=D*Lrm'}k6+fEswڱIθ/oBag)7Kv"*պRLcLaďR (o "~W3ΣoOuA5=ޫ= #vn~A^[*ȯ_Z߁+_訫h=t3;Th?_EΟg}MxW;,2e?t PkY#ԧ<[^mѤ[)DQ1Bi?nԟ'Z#k P <]Rm`0/#T 3t{*Y\ev忴m[=EyJ ?Z.1GJ똫_*Z|(GԟF?V`xD}oTߩQ͟{]$Ѝ}Džs_+[k)nOVo\ q˻2X݌ܤgyu!P'_~^hv j]U$$|y V;6vUN4 3p}>U7} ??e{:52>53? =,>)Q~QR*⾚GϱY) S^N}> 7T;L\x^ֺo&@UI{aYzt].[zgpT8#bϵxДZQRV«R+K/ i}ŝsvLT ;gK/ Ǣt_UyƍwH+U5%vKk|HRxU\lFiOuOז^c=5_ oYÃ"="3pluCf;Tz3/S._$-`m"3't:%c+׮+<:T^}moMנ@?JׅK^SgR'3S)BԠVNQHqN/ ix4HFjqM$Q (Ɠ4њ@;44;: .y=}(Krvj0isN/@Pi (5Pj!Lўi<ր?4Ӂ pN+GO\ެZ`ͻZ[Hj`= }WCj)ZLϨ*X5*ԇRe5Gf8EEh3u/n5 (=͊7*3W7V]oscd2_&xÒ[ėDQ2F?Qʟpk)h近aGjUX5m"FH!돕J΃jv83[>:e>+ ^! tw Xv"sJ}ٛ`*S)Mŗmc/Qhs 0'W_aM*++ PEp:_ ]N/,C? a0u6'ue!i(Q*"'|;k+ 1dO ǁ?'i.vWQYhAh0WGYn_!m ,:4qBeetA5)m<4!}^k[ c[eT_3̱U4}[ዕr"[XQZ2 6F5A,݉&0O/ 9} #ۏZ+t8>u)Iŧͥ>rgU8ЎG1QK;*O`+/C گ. v= ExA.IP$>p3׭ wG 㗈JU-\hV#ϰS IYnU߱)fw΅}sa6DvZUkz`CO?,7k-(V;hl-fϕ>=kվ 7T<1h :Eucq Bjo:fO_^57QI^|Í?Zռ'jc p@ =EJjLR(YRm g)+zO 1UsIW}* ?U+Bivbu {o"MW'4U6JLS?Ʊ5_ hBf>gvH:낅EJjLMԃ<+ )Mծ#) X7 o'lqei]æ[~>[@8]5<[p{hP\K7^}O֑.#8Uwc^gW5EwxFس C ޲Rs}*-ՓO5H/ji$x5iARfheSpcFi^ƾ߇EmgE1e|~P{UR?חJmچ,q)]w `qڸjUc~ѣlx' Ƿp.,Qe a5FiR8v IWk?ι9k*qpqOKNM_·|7Ә˳r- (aЌץGNn*gIt}}r0#ȗPuu{K]i$hAs2+k>x0!wDEbWc#Uڟ$:pg:!^HFz-ii  +M<+1I\,"G ҹhx{Wz,7fR3$_eݷ=Ƴjx622 ꏣ?mx#$<1~niǝ0hz[S'k')VlOy&!v6?H3]]%k[s{ڬ RC/N0+Ҏ? dguۻ_vWw:}7|ow ؎z߇~1/Kg0ۡ/^k=xG>Gf܎}{ע™o핖1״vfe^WGoiWJ ~#=X[JKKM't%$/b?ey ~ -xFo-.5[Ԗ}Ey%Mw&Q`0;(뜞kՇ5/Y^*j|?CVm`N,2vᧄwZVj6ҽ⏃)u"ayWSL7Gv!n^ x/fjJS#s  sq R lq'~?M-x6%%u9enğrs$FxcFx:#E~%i 58;)gB7Z5-eUqH~d3ֺ(apzN\F"+X&PQծRdvUG`+cPkuv\$> ڠk9 ҽYS"w|s?ix;+7G-c%f+5=^4,[$aq]u4(M :Qv=zukM_ KYOZ^JU[Soonۊ0ڵ4|1v*r~TƞZs1ʥh\ Դ+Q7b8ż)<5[Ή4O ^G^Y p%xFT;]vB @=Ev M=)bΤǴw?Vo"Z^JW9Ni>0cWw,vPږOT8Zj4Ϊx5MZ^JRw?Vo".]?J|,a:n"1\c5'V_e|ixQh&dO{vˬ}cS@?t嵝&C#dr[ӭT5C I/FqK%SJ C? 7G-\,EyP{ʔ(AV_ץ[&忻%@kUypeBx.G$WSQS[,lȆ^> {V#p>Orjxў+0PV9e7'v;4њG34ڤCFyffM&k*i S I(q4 q4=ԙɦ7S3I@?4fސPsMcED~hLjRqN[(j7SxgtEGezH {e|{8R<ݏx1[耿_Pׂ|G/oZm1+WNmS/dcԯܯGN3MPh6u4{2m|//-9fi$PVQR\;s^ ]UaxsPa~ BI6_`&i! L*?ڱ>khf6L"?qbekɮꢽ$c[maEܓ's݄W`T]QԟJ̴"(`"]}0>5޹=>\mNJF~u|5..3 @1$֝H8>2mDJo#FGlu2쐏&L omAíwe/ M|nݮۛwh&_GRU+jyY;IMdYǜO_Ll_JJ/5,kX&tlvgشVg 7vgsi,${ӯ);\)+>SdZ 1$KZ5J9]I+/fu ?䧟ڕm|v1,rI1I=}YHŠ? 67HʐqxTaShbF\[#kI553DjZ0G%䌬='WDrʉt`5k3Y#觯?C<рSѕW  ٪I${Tܩ#k^8X2\#n\X|3ZؕJ\VmFRU#3;j3]iWB;otc0굅ZR>W9G"_#ҤfxĶ^&3*~|0cY.=8w=NLz{k#FGk4_nw'R|hEbyznwت֖1yP[E|}" 1cOi9P ܫۉyy){Y^ǡV5{톣e!{ kZUZuirvkv1KB]Z\?#Sl髭L)b7g|HΝiSOe*m!|g@OVXac$S'Cetug{tMePhׅR0jOԄVҚTvǦKim }jyYHAw =I5H4VOQۨ;s\Rg\xbZ &Kv[$A'ں I[eOcD7DF̒FNrBNkqQZji 'vxm\C!jBhJ8Ri! AE&hzSA) )+AHM$TU4q2i3A'Ž)(I=~yyfEFFxQJo Ja4g֛hvQ&$X\҆O1%qՉG\sSɩsKB$OFAKeZ M?4rޞ[5\N5AU)`=21W^Uc1 '5%4 ;QLbؐ ȬQּؠ#ڳ=]>uǔW7Sgdxc|~$H'S:م֤G7O~ |1=ORmjI*4/F'e`?y/{GV~Ovq}춗Cq s"ȇ^!GwwڄFpSFMh?^ͻ{yd.Ƶ6A:~}X2*i_ʜUjvmBְq E`W:K?'SWW̿u??f-6;EM?5x{JRg k~eΩ"Kvinx]]Con4_V'~f4v,@c?Z3jܴ5noniYX$h 3k]]?ڝru ec{XZ7jWoY.,R玟 n}q^1)4x 4\_>;#='de 9'N?*;3G3hu]iIʈ(\p|0zk)JuweQ2ߥll;f&?`qڊWx-/SLqc%m? ccp6;Ksw1q1&>tcYe=Ab8u=gk[$^Lr z{*0+xrĚS܀-|?b=Gq_?F$Fs H#a*qdl_B_V؀o\d"cש|>ɪIʈORTt-U&;= BKq <˿NxIݟuحc< c*Xkj|`ݨi|P[1Zs~0? u*bOjP:Ưj͓n=~sV<|i۹h& G?νzt O-峠0WucJԼ!J#E,z:߾{ː2\ ā cFtԈfqHN>+HE (W^S e31'?d2.`C9M?6fȸP]Q hw J]U$ݶZ8J~ΒԖ|\Z#415bvs)◍#ck4,W6vVlt+oqC" ~4G>gOQ* E)ц=BS)rsHGc㙬/.n,{w>N3ƎG:k5X2<)ԧkj֒ק8X_E'!ig?ZV|ķgGd|kDŽٯ|&v ?ݗE}_:#Mv_Uxy?<7O^`cھE{m a0\֪`h ?–A# J}=+Od Gt]/4_`DŽ4G> òHw;$'05DJkώ$onl([w(Hl| $ڍVu%Ys=rV"}^Dѵ{]Jי-%3P}ZUv>u{Xmlp:gӯ ,`pNDa}hWzm :a\Q* rѨMHMU1K BEypx|i 3/Њ?>1TIԝSSvOqGsS<=(|3Qba}䴋#=G۷c5D#"4rȻYO};Y:χtdԬa@0$p\4qZƳ;NVhXч5? 5+OK9t*}~~xr)#5[) q ¢ R!U{QN%|₟xbV.?wk~ME(7x󍉸es09gX7"q\%ak2H6bR $>⩊ 4@'t9QBh9aa ,J=k݋WϞ4b~#xIVX@ա)1& W3xFEv{Dp\_qI('+4.hϥ4P(V Z1I@ţT\{qv"iϞ<<ŻEI)6ՒFi@1ILb~=4SKހ,?YHayaQYIOJ[X6:*N׊X|,0nnuQxM]uwT1NkO_gAz+G41S%)G:*;?mJD6HuFO?|ACH,uX.P@e2FC;וpȲIFd$H> pp>lj59Y @2DfFH^ ׿?9^)خJ:u#*tcʏ@DOŠCuP 8UУ3Y|=+VVroDTP>~U]? ?9^&)G5O[c%+鑴vQ\< VkPxsĖS!$ PHOzg.:+i¸֗4K*QOdա'^x/NVPݛ}z}?t??6Rr1E(<>>SoxnHg1!PrGr;׫ i´V34;>]iu G;5JCc"ӊh4zUҤ.XV?d:Ͱ}fErAayS]/.]Z+Jp5pccg IAizt.bTW`CzJ+3# k)#.xP/C s7S>'jZ,ů'p~V~,xVUiOi&G⡇^2 ;2+x*rwZ*S'X 1VOT+Z7x7;^ftSX-O.vj&cIi+ wo?A(F0V9'9MBuowt ]6Ng#!g pzڸlFk*ЍXٗJh GF~#ڶϊZ'H4B {T<4`jWX\9+uFÀϭ4RޙBޓJKvf2iݪ^!9JE.=i(JpRPbSӰ7bF(XmGHi%`,O>2i>[a\ҥ-ΛBaB8i9k>xk' ͂11ֻ#9Q ^ǬPEU;VϦs;KFs*n3Z3RP14`Sh9wxr(`JW@ ,!y&ǚUO 5U+B?!^vgúuoeR7W PnxP<;_;HonȐcn=ڪ|+\FIeh#*کaG*ٚsW\PkxY,]6iI/Mu9 ђ\]db|9]rc҈~Dn׭nxrO'BT_I뚴׉n&@cRC(O>T3\F1żJ嗳8ABs=YRurxmBO!Bg8^opIdu]HפB+mU0 T7'H&WlFnӔ;ҟ>mof䓿.ǗI?J|̓w߭h۶.Pcg${I䔏0UKե~d $.@A=k*Mr֝2Mi}z#؄\udVm7F^=֗jq8 pA|~ [b1#f:T¾#v;MKǸ_Ey5nQ%JG*1s.n~eai )MWVVvse65YFFW#ڏd7]F+y}i4^k8bI-q1t ³~ZQjS WCd^}W\{W>}ԎdodאַZi[Nשo>pocnoP޴cCKXM`\ +21ƭx٬u{y>L}[MU58 qnrqYcx9'ASJ*KQѯGХ<5*5۷{|C+ iA(;ID :}?qpTG}rν)ԗ}yV[[Km5ŒR|(d(tZ^%8~\pGҵ<-!{V𮦚.0e'x?Q^-LN+ۄc%(-~MZ)QJ)i&4W-_,"J-E$Ck:sӬ;ɘ|1o?+b{&+YO+#oK7j(zP~hXx/h旿&Z<sjrѣ:3j ` tkOx00uS֬gC.5KAޣ?{l΃eZEJZϯS#Ip/4R4n = xnpy :H)@\ъ:\(Rc4mtJ)1֍KN)vJ(!zbz1KҊv QKja(cޔ 98zbO3K7oKZ8G;mE,¬vS2JJQ3 Z橈m{DhE?}hFMF#3=xXhbs4[Pv% {Tx ֤q~lⴊRwS-%I }pAuĥDW}e-pH9}e=J#lǝ$T6QIHP|Ʒt٬1FU$$ݯr%M’=\Ս+W4y]>v]ƬC:r=)1*VzݦWG;[dJ:S^{'8 xSAWIrpC)" fo9_!# 2$zW,ݽ:pxibk*Qv^1Z1M b;!Fqq)v=$ݺ$@s=+|}%-yHFw{a4tmj8.!M_7,,67 Z.qJ.vFzZBwj-ꞺwpXGs  *ͮCysulḇd=xĚ̖ZWi12yqI+/RD3^ؼW%lrW $ۻVOKٚCei&ѭN%EeBqtI0X[^#$K$k(fPV+1ode;gvwfM]NBp֓F֒Z[y%nDQ9'VME_Tﯕ(PM]:Wl4xqrXp-EUG~jqZ r'=u&յ-:4<ݤ!Q{*2r-˧[͵)a5ZIFgK^Sj7\1S¹~~Vִxrv!rI]gěXi^ZIՆ3Ϯ?_~?;iaxt&X V^<|3׵Džʐ*wUOS9/^Y;Xv=;WHZ^\z=?UϤo)cJnVS1l*UiaEJec\F[^3'Q~8+R{]>Y|$h S[v q1Wף~h!Gh%>Emx~Hu;I>FH0']3*ʶ zN\IgokjL #N_}+y\wSEivqP]]_j*-Ľ돠OIo Eq*S=نy>f3,Eq*U;+$wm|-*RTr8CT6Q^7/l(`UqH8ʩ"CcUծaL#t{$WR.=HUK>t*A=7[,XQv}tqKuç=ryx[m,CV?"<7su.&K ]:SvURU T|yi6 )<)4]pG=Ŕ+q_̡&u\Ii~+YgoT ?C]sI9T)6s]tV*J+qoK:M3+s!|1*m;MVVqG ;!S.6Ύ SGmZZ~ #:Zj;jshn͛39J=kV.$b?J /c  R Yo:i-]m1B!b*kks'%9'$#WZ_^Mm5e,Hx9_Y_-Tk\:xZ 65ԓVSBMUgIy{~t"4KxfOB2O+ֶJ K_ΞOnjtϩYJM ?T⺈OOHPPwu[ݷgcQ[FTNw读.W)II#g$"o@3R Y2&ʳ$"covV{17NCZV}Z%aM_?zIoӳG.:^h8_nӻ1:X%fXAز]G.n/ndU Ǡ>51̷ ,X81򿏵ElqO I&_fتyl%VSvw۹Ɓ8ᙈA=jLBs@29)ESb7)qL/?m() !SVr`3*Hv'j;B J:qXʫ{*vEXc20==iG;B8DF'NY\tZI/y"ܽբM G2 z_Zh;xy Ϙǡvp0{g<`O<Us_B%QޣWN=9T*:cd4NM%+qMdPH'NU'XI U 9x?NJ4K3lױ\t+%FMGbiM8tCHEO"cj29KJ ;3@❊EO{E.=VSHW5? 5kx ֙t{qcp 5cDdFܻP/=+/ 4 vv:%o=ݜ'M̄ά]Z֟l,p03[yNN!Soqmۥgգ9є$NT;=_M5[n^Kg=r;ںg[ti[ef=U0~+k\}mԖɗ 77(nX\Z SRQJuk,|*mnt-nb%䵓0z!W_cpPY꺄LsqmA,ӠuGuqm[iaJ^J/e+.?̟9:,MC^&[ -CTĻ+OrE7n*HWRQXKq1j-廛9aa$qY.aҨJVo;yګx>Y輛_ևI xGo*-{I ~끂&XmtԴ{s4QU<(.yq2u sr;< O KsOV*tԜn-{jJO}_q_V?xV+xfE.Cve،ם$$FxlP u9STxmY<i#ZH4 5|/cuuM xRsKMQs$U5Xd3M>vrY>dțϷ,7l$GL*@ՓQŽ4z%}yqt|vOWqxʇrP9~7z%ctqT&amO1W[G!Ɏ ^ ,>i&_4Ջ}}cH]p3~7j;/'*0g,Wwgsm22$ 953Z(gu Q,JJP=i=mhUu:Z)hT6#xW;qO?;ic-oq+ghcYc#q%}?\n[q#C(M*9]{ZzuLl)sm)]zv[IVCre76ĪjsޙY&x#:~ʹ=̑}V~fd4k;fʍ&I!=i(qxjj.ItEwqT4=}{hzf/e$[܃>I]¿v\{!Y\[Ϊ}[+LQ 8WM(5kniKN{-FmBV 3~x#l|("vAA>ҹ{YB~a`jj"$7g|m.ĩ"*mHԕL&!AUs8פ{|nvUȷ-#ޝ$MTJe]6=[`. iʪykx%)I%$'qįe^i6մZoCS^E,a2z!RbZq6x1!?81yu9YZ~l8u;?P7wW%!^sEc~QIux3=?Ms+W`ǫggKIBU"ۋo; MKMTf~B;N:w~*0d_ֹ 3JH>kO=QPwӶ݆G>_i Tݬ7^(90Ҹ8kXaeI?Ͻq,Ybzrjqsqg.8u҅Q8;YZӜz;oѝU'f0 9#O,;ƶB;c\|lFe>=e. FbGn,3շ澙GG Vޚy3DbsjGilMkjSN][~W|0w^z?Q/Lo{;BۏL;i}8rAAt$q.)Ԡa1KN N1N#]FI=pOR Z\] us݂Mw`fH*QqM;դ7m.E?ZO>`P#)nT!X#ۭ{8\HOZ5? jo(gWVѲV\{/0Io?Zк\;U +փ8Y#.E[aL)^|FZjW1R|sRRm>nh3zFw?=}*Sr0kjUm!ǨNbrXҷ n~&4,JB%BOpG =qq^=kWjolAjЉadˑ)*>It4a=&7+t:[+KSUyi$ԁ}k'>y)psRĕw %d[D{3?J2Fhi1ϵ~?y!W. 'o]vz9lO Bv_v2xNMڝQPd9W>&#Ԭ$\tϖMv:>˨k}*pI8 ~; ,z ßǭ|U )J'K=dRt(zz_j=ݬv.!f܁M).K1qְ~'FG3sZ/^);IY9'W-LVKt8Mѯ'URQvc[L}Bm hA|qY>?P O_x7r9hsQEY#W"N XJg"Ry?TONٽ<%k]<"nq5SƗ/ifE*eq=I˖vNH5[#+縯O')G M$f2wJ5nu91ԪZnӽ{-/ݔs\ȡPNy?Z[_G>ݟdI {z85WzZ]rv8HO&^/ټҠ r~l3թRK8eZ;I7ͭ,VQ/Pr;`B֡q5ZCV&nw^OAZzƏm ໆ*m6Fsu2ʘ\F:$ݵm'򵎜LcjX{7̟xV_QeuVx\gX$-tKyќ:lΠu6B7Њ +S~\Kuʲvi=퇌 ?Z5GyX3[q׮nm&Uu ֞)fq͟9<Z۲^gX(?WnzM[JwOoiSR\N9kQY0 8]6[v&Q;d29\ߋ۰ql.:ZԑQ]Ky[ԫ,IQQriI[I[ӦUI;;K2:Z5=ZYrIwT.rzp:ê,9=~ϙ{|U<4tQ`CНgKh]D w'uhxX(30<*K]oM6S5cU߸23ɢWVu2 W}!k~x703ƳW!e@s:or.VS*tzJS֛jQ}_y"t¼㤒i˳yt O`1ڹ~CF^CcW9t{nOv4ĚJI2rv䎼u'Ҵ}NbjqofN)N JoN8E{Ӏ(C~{3ވkȪȮ]okt?z~Ԛy."̐FpYr̹c)̘׷DԸt 9 ) 9cNp@J U]GNE9@'(Gp,¼WǿIl<.LqU{RZ)d{%֭ٹmV"(1T#p1`=9fWW9gv,I&fe\֠kݡhdf !ǹ,@-wɾ~]:791ܿ^? EX- z?9)jɼCڝYI')5eڑÖ$[kh)"V&y1s0$Ymge20B:gS_#s ?$wt)=l9=xVP3SQW[ɗa+:"1Ӿ;W=tFWd ؞c^G8ԭSkFjJvu ##8ϽVӵ]?V@4˻[Q1H}s_D}A!7R߀5<7-hn!=@=}Myhrr3I\ӓ:!Uas3J*J%\m$RF tsiZ؂ 'k9D8&4'e_Az"]C̬_$9W.ȄzC9xOҽ <8Vrg$`;Tpzڌr3R8ML{w1frYsQ&5k4rjaϭJbhLⳖu+ܱ<.Ug': n37'ʳm֡evBǴ @zU*}qTw4F1Bvs)6ۿǵNf 8=O B\UE5&Z!LŒR gX[ieQ@Au{5&7TڎzALK(}s{ch'竤#`bT1zP);|(>*ΛmT H Ҹ^F,|9J;Pg҃mܔc=9T9ax{Q:Gz#?HduurRZܮiȸšrIzRs+9:sw") jPCuѻ-3ȢBm#~4jYz@;i>Pf?HJP=iS J8 p_Z`DQ@m#B&e82:~-!m9&?q v0ʪC/5w/[ZK`/"=c%O(GnS?Xkq2WzNqEujdCj_k:dWOUaW{M%?z;J8rr9; bc4=B<NԹƁǭ8ZP9✣9CjLP=)q1N*y@uѹI\M杊ZP)$&)q.)Pq҅47sJ}jh0Z~P)E b@ SLvN֗i`Ґ1R䖡`U,pOs^&˘ d7yq&z]B9U%>zWx&gb!M+ v|[YCwkͻU=*Ҩa|ti} yԟRrjbw9Q+k8B.+3zKǮ}iEj E+$4|~r8IeFqGPFp3։>wC MRUAw2~;Z9<+}3ު73c-H1L>$.1q ԂꖫrÞ2:~5&:W4Rx}хclv PҚҞ[@ ]y1^i|-죊O c83U}. msԩ:QRk}HƉv8z'|խ|B<% ;+“nCPn(;s[bwt::MR&7a H'9=咐@8=Vq[[ı ,hR:.9\n'~л@I=sәH\L6 wNxr)^ղ#nq=M$SRSDE{c0= fHNJRq+"1=3V+2 w?*ҀLc &F2Oo_Vr ='ڹGeFƸf-!HG',d6p/Ow!#8%uaD."&1Z4 lR:xSRl:f1r[2"=;әXNUЫAڴݼڟi@AïJ-p_-=Y1o\Wz{/#7A<R2-ypAk':i&h3SQcjfc̈oZ S^>84{*jbuf O>pN{DʷbX+a>iѨI9 f'+8;՟h|!l9kU"Be- edA'0O?wnN)o^sq\QG]Vܙ)"T x;Sph")=؃l1ӊ;/)#OU N9!Fg+3XTuSsOo('˵t  ^h n?.73N# *JDxi?Hh/✈[YI<j4bLӫ<@pI< rN9ml?,g<zXPWً4c8qQNY#ԌZRHX$Ԑ"? =NrЎ))d%?إ]wR{3y+Ҡ Y,1})+n[5"s54X՗;1׌#as,1ܙE1Y͗؉,Ս9-?iȒ ExOsD6#P<9cIನ}}!:Js*S89ycǭBRx#4{e<[>jcX=!-]fޜ2EyxhW[Fwq"ykG=&yXw$;+]=*mK 8$Ҥ>b}x#HcD@23xXTY]fEmOˎG#<㞟6a8 z,eY|AJUݐGfs>eP噔~QtmȠʎ}{ՕY;raֱ; &vl8>;OP;lJ1n'vxsm_^M{qs{uO;7QJ+D$=cTtoORV]E?}u=0Xzu!"F򭔔59yls;ҕՠر5UKj܇ *qi{,h͔ܠsB,5;/fG)F^BB q?i@y_^i[h b#$:@\psZR*TS\rkc|I 1tq;Ny'ێyۖ zc53Kd%B*yS|B>E>ZFLa?0jf$4+,sOBGz[J w4[>:pEWhGAakuu{oikg;p+.l4KECW Ӽm\Ư`T0_PmҼ\e4iI@1"-As894lϥqέ[HGQO+$R6zq($"a8z:1ߛ~}.pT?Sv To4x)1OS>hLcpsE)YOMâ&Bpe`yXF~=+V>̱LNEbd}+xOshQrW|@tcLsoq!b6|ןI ^G"iRO^k*8nu~YlgR>ԱiHč+˩OV;#R2ث4* ,p$>?؋)p":g6BAy}x20K]"8\љ ]dyv\(@)R◷H;ӇxDܭ֥n:.kn "%#F~*8٬a)- "Kb{e_WjXKHۮ}ׂ֥6cu JM]p[p ߉:EEtPUԟ^'k({I EZWf߽3beUq>b==)UI$5OMX[rGOUHe99!s!=I{SJBd szٟ,$aJɁN]3flZ3N[%mL1b: S zP0Y( WAZ+(128Ng=LR`g6 W8&G9xM.2zt~h!ÂU#V8CFGN;Jja ? tQ_Q)YjmyO6Gە9WETZʀfC+!QpWwjuvLi+]<0"K{?*?;QIUP6MUXdp=($)^2T[T 9#LcXv1ҍ5a2mQB9J򏗿+v|Hp iPz=;44BGOlB@" /9 M'Iأ Em2khY qu As_>|n׍ԖWa[h''$|km=30Rjr!@i:OSkɮ%mHrk0Z-l^!Fho,GB.;_5ÒҩlDv0u;oǰs\杩}u'.Nzޠe;)z,IESEnu<`ݮ#_$mL`WYj#+xqfn:RJ8r&TֳJ[E$7QK 󎵩5$04(pFIß uWP*FVʒ+r´7"'R4-#ÍWQ+% kѬzQFf2Hq?us~!NG'IN19^"RC_yі;A6A~5t7.`/X }sk˜ "p[ ~:jVn6LqEUU`rqQ)[8'=ǯz#PW8u"G֌š%H*l atU h}qPOzrsʤaI>B`)'m}^ =x(ޜ'dݘ!G&aqJH5$cy&Q,,8WJm%$dz楧GQ6#5>n yGW͗7Ӵד<դbƫugSGRy[4mFWxnw!{jLEm!^qsn<-yH{)d_Gܮ})ij6\H$xGǯM>~}ӷ"gpaӥ}P?@tZB@E̓~_zO9z(8/RD9p8'SO@p5v0Y98Py,MW3b嶌xSGD;*!xM.@b.AkpO{սWV*1~ojAOH< mČfbϿ.iXA<ı gԭ"߁qMV#q;w;YB;ɪ"1Spy9>cJ`.seXhІB)JWv-Ïzg֝*+9`d'91NȡRp u.NF\c~9➪[$9Ob8zΆB2lX (?zzG: 0sVc0˔\)5z@=8'SP±*DFm/U,?tTJi#HғwY{Kv7Elڭäo(q{ssj-I6yeRsR)j d\E_F|'{R"2*uDgPoȩS7T& 3yqv9'[tq$^kz}W?oX'^1?|/Gy|dpT A?g/}_ _6nIӜ~gP}k5=XͶ13u Fpzk;g6WId`A3c t7]:Ĭ㎤TRgloBu8`W$֧`+ɅVo>dn)GW|ZsqiBԊ8I#KTiM+Rr8KeK^-A%1O9G[}¾9nu8ii!ԚOME6~"ԦVyX3kvmۗqZ:+5S_QqgqTIw|sI杀A֜!jR?U~6O^ < 3ێhcR( HnO8pM&%SJUÐ:5ὗH@N)_Q.c2}:ӊƘ(ޟn8C=n@( 㧥?` sAКnw #<=Xzr1ҝtJsFOͥ$+riFKڐt# kOi:z z€eF<8 g>lYسI9$q$E#='{@=gֵ%&5lp?ǁ5ZjG^+AjP)[F.K,bBʝX"ҝisX gnʖ |4k+CXnOy.oNSOZ+{+=̕ rv3Nb^4Į-dx+vzG G/źImBna(E(Rceqcbe2NAmm.Fn=}ϥX6?zS~sA*^WHVc"ce}*sNap =kwc%+GubIrO3HGr±*T 4Mo S$:2M#YuXKdM7Q>tdH9z|-kl4N 4nNƪLm!+$uK1Oʦ+!!K!f?u{+{F<hdxI?ޗJWa@vhA|So@FA$bct?GRM'{HUr瓞—2ߡ`օ{" yq?_֥cK,TAkOnu'ː{lTEm[mC"4^ Nk 79rnou%c<^[DG!Ki!I$B7.qpl{mI.k)`:/ꖐЙ#R7(~5`yJ.`c潛cI^[DCBzskbmq`v^ծ4-jTl\ZGy؂EnG"џu*\SgEi0^L[Nї?V@G}7ќ Idc(#qRJd_*)@\ K P_cg=˄29=8-O -Bu"!`{˺3#bI$Cϯw7.~ꎃ>|kPTbU}E[A7uN ȯ_/c=H!BOҙ:'G;SzzxtRZ,)=4s\Ф !uRVOUqۓ{-"C#1,@%~z#z!í,Z|opTBz\1TzSqSz܉NNi=R` sBi)j/QMxpy>#⎤#ӕr5؝>q)o.  aiQHq޲Z^)X*h/QX9lZv!8Һ}YncFA\ʜυvD {m+ume_vsjl7c=]݄N*jO5I2"6wNb8>H0Z3vOvz:۴M[8'⬑$.[, 9#Rvr1';(De(vboleJ0' A#Aϥjr%Sӽ lԬ81~>_Q1qD Ÿ\S}iX|6aJ=zQsON7kaXvN@lu6{b;ƜzcZ/w xgl q&cRLxC4Cpu;$`z{P"XT㓞S4RDRFMR;ARFː qGC1S1v;)6RV{)B{SA|d1Ic?JJm_[OEbpSx>-L$m,X(j/N]n-,HbuJsU,?י5F޶='KN%Fą^W{(A< qҕ^9 *r+i$*SnH sdqU-|k‘ztقݰJHdT'ldn=Ek{+35vHT?ƞ$dr;U(# m}zX$ 4d4c=N?* A{ҏCN;v.zM5&(n2G"  \7ͱKm\x.vEB.OM+ly*>I{py㊖8UF6=)&_%yTO9$ֵFdQa]L#.R{7RyY94W*v1T?sڦ]MY1 Q0}1Rgf;OaLS\(!F%I(iQTc 1 dwHϜ t{z+v7q?/ p}3R黜zTشdz 0vssQ9 n)UJM+-1lzg]AޑFG枣UzkdwOrOJU翥I͸u1w#r̲,B-^Xwڃm%i,E d\>il %fHXF:~ h#04Ңb.8|*\xSRZ_3&|-.M;q#&=YgI>B pM}p 5/cAoDh[cǚ';CsJJL߃3ڻp%(/iL^1'CX4 E`k3\C'7<$k|iUUl#xrIL"O] M򧅤ިs \G3ylO-QsAiribF ܳ`는-O0ӕj܈Wn)c ]ak~/jn,vLo׏´4Bng]YI8. eobLwlE{q3͕2eBU^ j@8sox @O[(t~UhZ=cdGL73ԣ@G0X+{S-%iyqL̹YᪧҜ9 ZYOpv$. ϗloxTHEc~uVnX4;ʼnVe=t8NHG߇ 甭7Jޝ)ӵWݞ;Sdm+)U{"K̑Qy$׼xCN:vok|[S׻*vh_V*^΂_7 sszoۈn'$`5wSwdT[?p֤AZ0?(l8Wy $Ve v9F^P빛nuSpYT=: ֜d8kr7Dj8ǭ(\uKdJU8}9fn"ҕHNQRzd{OJHic;G$8:{ |RI(܋9=v\Qt a8d 2q飞O+$T!Fm郓N RҰ9!nn@8AR4q#8 H!}Tk;@  wkx%_E5gq-W9 ί+eKu#Yzu)/^ \}3Zb(QϐU\ήڅ ]oFMb`2$MKHNoi 1oijQWSĻcN8cm2 Z>ږgeN2VՔ'?;l53WҔe$fFv.F$Nz#6t\skL Stx4h[ݔDߑgxEre#hZUĞh@-ԡtP`\5 xqk3<玞ՠ˂F7fN8U%sd"*8OҤvM8&=ivӶlhS$9%^vAx>9CIv~b֜z14(VE_ f”R"bҸ}F0i2z7ӗ)ޞ&QxҟW(n)x OޕaG4@! =iˎ}i>C f sGR݋м O>T1BmrT1vAV9֞ҳj.cHFTki[jVھAy}ץ?% ~sJn訫Y3ú%g%J2'B팟~U=E(Ji[c"B%{SFh0)D(|*x_j\zx72lh(HDN 60  |OUܲ݉gIX4ܬO</0˃i %t|}r+gP6WneH?Ƽl㴖WǠZhFMJ ZymOKnU}+;R 5G(5t +*oJ͊\g#ޑ$q׎k8ިt cL&ϞE7=ahp0SF\jʼn@(R.[sVb viXtc]%Scq?SNEam%_ |B_XBLFEZѾ,*3X!ja4x:3\_mn>M26&L sֻI"GTE, OEkw0afO+(C^G[J&+:R#|䣢:GiUQ Պ*_bR 9G5odLH`{to¶lTW@3[1z*KS_:Yv\ҷg".r<~UfAYzt<#.;+ǽ,n'Ǜ,JσEI{>N]DʹddP8suvIt 0h"fŽI 1qORm;OOQDƌg9iǾi-giN\!J#P^O^)Zv9hrvg9$sN$(9a83ԸJIBqF7)0ނ)9!XA[OEt㷊t; s <SWsOdz.!B14/˭:ۭ +c͹;O\s۳ϭK7&Wn%0?-$G鶾E<[,H`ӷ?9\s+'XUBĪAT/t&Sv_rHrH4 cvVj$Sc$e~8n\ SE6ӑT)ñ~jq)czbBpG>^(PqK܌z:S3KХ ֖wE a3@>zRQ)ր)'rӀKڗ.C#3K99-F `N4EsޡlZqFqS2(NNrj o`FLR]< 8늑@ sKq*H$ o*B,8Ҡ=Erh/ʽ9Mr.nM4.Ӹ`Zt'=U!@8?ϭHcʐ |Hu)-N˹6 ĈP %М|D63$q*rQ]ޟd=^O|בSz#N%[ǢiӼ]2H *ڣd$r9[% 55bTdj-w7^y8N8XvR{=hQ}iI N% m֕.N]xsޕJr_◶Z^#;Mcyy攎ߍ;h8ۈ\|v8`2)SH HR^I4${'JfTɓX!W6VW-j&`L"? Gky>j$pu&Ep=jc4ToFֱ,VS XU}s\#wOLgW>" ܙ*?j{6U8*ÞuMF}[36 o"yg_ 34pI׎|5/Gk ȅ`g%z:z?+{p2D==yԟ[eo1(3Mt?wZYQcA!y+ɰsJP?Jh4Պ:.8{19F)1ޗr@sNQ妃RipJQh r֕ZVNǭ'zv(S~)@C)+dtR7~ k&Y $YsHrgjgӐ~"c=4=8FQFr4ITzO (hyXϘ[h +j@( %I=zԹS.O&=).rqG.}:0qThK/*r)qnFoP(I &BNS%e]Em>C#VU21PYKݢFp*n[F$ɽ(1e%V}qtk iSҷ3l i n⣜V* FOkE1Wڤ NP*f4Dojm<Oھ})l|GCL0/V.vq'%rZo9<`ʯR%kټ +* Z;$+/Ij0 j)GZcr«N5V+lsTkLI#${x)I^qLw ({sJ"$ @Th\UV-_9zW|=&Ծt{wO&\w5y8ᶨ4ydo*طlqqR)%:pnT{"ŕ U*޸Z\ ]4gfe.qqL dGzv1f34mv2"K`IwG1jb2" 8}[ @.k4p:Rǧ7*8p,F{Խvs SW^H|$Zzq?hXP;S{R\h;79Jhz(斁Ҕߝ.k1Nu"z9CJGrsP-+9 YHVgOjiPpw<){u@}Vh30a@ex8?Cfy T3U-km?0⭢mT/z9hpҗ7~884L~&H$ 5.bbH2b2ߥ>-id ^޴@.0qȬ\cq%GVzTGSH-dg8PqJmO9|J(<N-ت=qZćFS:(vޥºlx$󔍾Vs==iL@fR(*;r2.=Wҥţ pbM/ʴLb3~B+-{ɛdme?鯇I{ԸTIdE˫nJOS6$Ht%Wŏ4ǓZ-Gʒ.Ү_GR2H@CHOC?~;f('zhh|,kMY(5 ]Eԏ>͟=kV%&')j nqEq7RS\xi-S}J^F֦v#~]ѕ< U5mV׸I'kWN *F;V>RF?:5%aIK֟vv21n~&ʎ)ᯉu{ڻc^m#lQ`x4R r%MI:Kn8 u{ݱ7r>P3zSnKkN6&q5Ё玼Snû0{bQ.G!r:vJrVyu*9b 8$r'S6Ȥ\TDĜ*AI '*Z5,)qlT`Ok5>`S ǀpyb$ C|`s&Ԕlh)?!H۴0NHv< T[Jsԭbm6aw'ևvT gD9Zey FQN;lTEFQ2GӁo#(L2Jpn(Xq+Ŋ#*,#fp<2ivNr0H89q\fq8@=M52lЌR?:NNQJ8/CKڛ6״):9#h4H| *' ~SCEtՃۋ:O=\F$i,e$PzާL`Ti=iƦ$7yY9cB k Zjԉh=GJza㎄X1[AHvTdS."x<2taiUԣCgEX@**ӎM2Б>(1Rfc-%(bC(R蓞Ouu?|MK.OꍜnU_ͅ|_\deOHϓ4N|N n9ܻO1[\uݎ3]ֻ5\T67c3HEJ&4fUgwe>`/\ W%?<זj~^#|vڊ'^UYO (v=Szȧ!f*fC5۩=t-"hg ?:υNu tǿٹB~^frMEbTtP# HEF y4b3Q8ԧkF#4Ra\Y>=77 H:FGt~,.qW#çw=`S1K" PȠRU lԀ3*2xje<TFfqptIkʾC92? r`3+1iyƼ’k9npKUETDF0* dnf[$zA 6s#N !86 WXاs[ܚAi c=sޙ ;>H2sGa'$Z3ِ8c۟қnTpnyqڤuP)DS`xF (,sH7J$E䚫g$"1>j^&H[!]J^)㯇CH/m{hr\zsץT9d݉t/䲵-MIપ:g'īE rc) ݋5^wMg@8bg{.~XC:1J#Xd܇`H˒19zWu*QYje >DԳ[̑&o)™ ܧj2~ɭ WD$D'oH\'9',2k?.Xԓ`Q7~ChCH˟V+5kar#73|I^dg{OGkyMAm>on,nKH8iuY!xl0~60TdxW2Iee 셄q,1Dc bܩ?,*%5kjoZ4+!-`g<OcQjujk(&'C|n-.te,(#q wkwx<)%n29p>Z7m zXbTVDd'Z Za=I!E4(J0j5<=*D9\fPpN#(v8 .f ;?6FkxLN 8ۭL Uh p#E@ dd&,.y(sZQIJ'ռHci1?EgWf" d~M|ϨĈJ0s)/C/et+( R@cFP6bj)-hsSL.+>xh_)q2f>vO-jGφhL:e9^UW*;i;:W[(8 ?U]ϳz"A ;+y$lǠ5OmvX*\ˎT]pi{x5|L֗$J"O`/8I85x2GO/w"Y߸ϹqQ7"5"r6 rzi*\RvW+G_l8 x?Ҽ{waЮmlv@SC#"Rh)Y$]IzO֓3({pjTo^+Kh(bMOFӥt]="i$ǩd;Dˑ+־{^)q(ϯy֎|lIbOH A\U)U:JwS XC0tpq=z/i "m1VŹclU囏^kq_CpذKgi$r698=nwa7QG;BͲFwVm^@K"2Qn3Tm>E<3T,TWsO@Q$iZtFT/ۅlM(2!r 'n V+7X96AG&.B[RKHVl1G_b|K,PɤjQ& ZurG*"RўQov[D5|`6Is:-g)@܍,[#hW1UaCޤ ٢3r c&W=*N[¢azS.1*ˁ5B eME08xqT܃^)UHGfDϞhv뱾MZ.ۗjW⟄}cB5Fkkgdur:@NVn@\JWqoGF1u%F3^U[b fF[$(Ӵ7s,^frzwλQg+ܠ G$猊KC$qSx+6! Y 0\q:#(AԩYq)Ӎ8œMKIAlJx"?g`s"GU<ˑW&x_K6xtWv Ǜ/\տ-m vS6Q* Tpn-#RhBƹo6omchfs;[=J陫Y7l>8sL$fsʛ4vGsy*c1PD"n2)CڹP1gQUle>/jv. ɑCQ_UJ5n*:n]QR(FrqڎWMS?4hD$0{ Ev,&+&-${GKJشʾR+zctLHcEJnrԊOķjf%A\($j9%cp@玼RD%VR%M4GEֲI[02|'Z >Ek'c9+Xg eJBc<`qEzzSQEGQNYJ(HvxnEM )@q9.;QE5ih8H{P 2[)'&cLOyE/9#Rn ^/1kǸ#c,O(IQ (۲^v &B\:NxH#1 `(~d#cwctU\d(B 뚓}Rb$z7|QE+y6,p)QJPf),.S@(|TpFTu--֦ QHta2zv:~nv#GYqQSLrvLƗV/E&r[s+7[WYsY{xas4bE#94Q^}T}Ɨ=ַ2<+Wc;K@Q)LY $r; (˞)3J8ӬR/D$ǎkM-XVFUt- ]s;zQEiUgOE/C+IR %ڥw8 VۤLɢZ]ob$˻3c{TKyɳMP0Ly@;yY g.]'u9->4fY/݅mN۞qVUW=6szOzv$V2/R) TiA6pzH:"įtmL;; gڊ+?Cd޽Nv`pקն탖eH 4Q^EjJN*;1sS4TRˇ9Rx篭W=ju)>J)/S'޺ܺIH\  :ډyf#QEzmY8MO83%RO93|8<20EV)ܹ?~ǿf?OWmMi/◣[pEKn&j+$l>WRn譵G5^hD7 @*$t܅r qE97~SnVȄt dEzNnǗcoo6Ee獇98״2 =ExDU篆 Warning: fopen(https://newsweekme.com/wp-content/uploads/2016/01/JAN_20_2015_INSIDE-COVER_ARAMCO-780x439.jpg): failed to open stream: HTTP wrapper does not support writeable connections in /home/newsweekme/public_html/wp-includes/class-wp-image-editor.php on line 428

The privatization of Aramco casts a spotlight on Saudi oil reserves

By Robin Mills

“When a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully,” said Dr Samuel Johnson. The same is true of a major oil producer when the price falls below $28 per barrel, as happened on Friday. Saudi Arabia’s economic reform plans, revealed in an Economist interview with the Saudi king’s influential son, Mohammed bin Salman, are certainly concentrated. And nothing seems more wonderful to global investors than the suggestion that the kingdom could sell a stake in its crown jewel national oil company, Aramco. The idea of an initial public offering of Aramco raises some striking questions. What is Aramco worth? How would such an IPO be structured? And what do the Saudis hope to achieve?

First, it’s worth appreciating the sheer scale of the Saudi state oil company. With a domestic monopoly, it produces just above 10 million barrels of oil per day—more than a tenth of global output, and twice the next largest, Russia’s Rosneft. It holds the world’s largest conventional oil reserves, officially 265 billion barrels, which are also amongst the cheapest to produce, at less than $10 per barrel. The world’s fourth largest refiner, its joint ventures in the U.S., China, Japan and South Korea cement its access to world markets.

Aramco is also a strategic national and global asset. Originally a consortium of the four largest U.S. oil majors, it was nationalized by 1980, in a gradual process, which retained technical and managerial competence. Respected as professional and effective—in comparison to many other mismanaged state oil firms—it generated 77 percent of the Saudi government budget in 2015, and oil is 45 percent of the country’s GDP. Most importantly, 2 million barrels per day of spare production capacity allows Riyadh to influence global oil prices—disciplining recalcitrant colleagues in the Organization of Petroleum Exporting Countries (OPEC), or trying to drive high-cost competitors, such as American shale oil, out of the market.

So what is such a behemoth worth? This is an exercise in making up large numbers: $781 billion, as McKinsey proposed in 2005, $2.5 trillion according to Bloomberg, or more than $10 trillion, in the view of former Saudi petroleum adviser Mohammed Al Sabban. Compare this to the $350 billion enterprise value of ExxonMobil, the world’s largest listed petroleum company.

Such estimates are meaningless without clarity on two things: Aramco’s oil reserves and production; and the way it is taxed.
Some observers have suggested Saudi reserves are heavily overstated. One consultancy estimates reserves at 204 billion barrels, some way below the official figure. But such debates miss the point: even this lower figure is equivalent to almost 50 years of production at current levels. Compare this to a public company such as Shell, whose ‘reserves life’ is about 11 years.

Amin Al Nasser, Aramco CEO since last September, said in 2008 that the company planned to increase proved reserves to 450 billion barrels by 2020. This sounds exaggerated, but undoubtedly the Saudis can sustain and increase production for decades, boosting recovery from known fields as well as discovering new resources. Oil to be produced in 2050—even assuming there is a market for it—barely counts in today’s valuation. This slow rate of depletion means that simple rules of thumb for valuing an oil company based on its reserves make little sense for Aramco.

Precisely how Aramco is taxed today is not widely known, nor does it matter much when the state owns the entire company. A part-private Aramco would need a tax scheme calibrated to pay the bulk of profits to the Saudi state, while allowing it enough funds to re-invest. Mexico’s Pemex, for instance, has long been choked by rules that transferred some 60 percent of revenues—not profits—to the government.

A sale of 5 percent of the company could easily raise $50 billion or more, the largest ever IPO, and too large for the $350 billion Tadawul exchange to absorb—requiring a listing in London or New York. But again that would require full disclosure of financial statements and oil reserves, matters considered state secrets, and open it to shareholder lawsuits, anti-corruption laws and other unwelcome attention.

Listing only part of the company could sidestep such difficult issues. Smaller and so more digestible to the market, this approach still retains the option to sell more later. Aramco could offer shares in its ‘downstream’ unit—refining, petrochemicals and fuel retail. Already 25 percent of its Petro Rabigh refinery is traded on the Tadawul. Or, the company could float a select ‘upstream’ subsidiary—containing some lesser oil and gas fields. Non-petroleum assets, such as its social services, would remain with the parent. That would give investors access to the coveted Saudi upstream sector, but without giving away much information about the country’s overall reserves. It would also ease any nationalist objections to selling off the country’s birthright. This is the approach followed by Chinese state oil companies, with subsidiaries such as PetroChina traded in Hong Kong.

So why are the Saudis contemplating such a drastic move now? Although running a large budget deficit, forecast at $87 billion this year, net foreign assets still total $628 billion and debt is only 5.8 percent of GDP. There is no urgent need for cash.

Listing any part of Aramco will be a lengthy process, so it’s as well to start now. But more than money, the proposal of an IPO should be seen as part of Prince Mohammed’s ambitious economic restructuring plan. To the outside world—and particularly oil-producing competitors—a stronger Aramco signals that Saudi Arabia is prepared to keep production high, and weather a lengthy period of low oil prices. A shareholding by, for instance, a Chinese state fund would provide some political insurance for the House of Saud.

Domestically, the impact could be even greater. Greater transparency has been mentioned as a benefit. Aramco is certainly effective but, as a state monopoly, it may not be efficient. Mentions of eliminating corruption may be a warning to prominent Saudis with access to company cash flows. And for such a bold statement to come from Prince Mohammed—rather than the king, crown prince, oil minister or Aramco CEO—further emphasizes his prominence.

The prince extolled Margaret Thatcher, but perhaps modern China is the model—privatization intended not to eliminate state companies but to strengthen them, and economic reform intended not to accompany political reform but to forestall it.

Robin M. Mills is Non-Resident Fellow for Energy at the Brookings Doha Center, and author of The Myth of the Oil Crisis

 

Social Streams

Comments

comments

Facebook Comments

Website Comments

Post a comment