The world's largest oil company, Saudi Aramco, is in talks with banks to provide "core funding" that could be provided in the form of a loan to the buyer of its pipeline business.
International investors, including BlackRock, KKR and Brookfield Asset Management, who may invest in the pipeline business, are also in talks with lenders for possible financing, unnamed sources told Reuters.
According to two sources, the loan could be up to $ 10 billion, covering most of the value of the assets.
In order to somehow cover losses from the collapse of oil prices, Saudi Aramco intends to divide the assets of the East-West Pipeline, through which the company delivers oil to the ports of the Red Sea.
The world's largest oil company completed its largest initial public offering at the end of 2019, raising $ 25.6 billion. Saudi Aramco later sold another stake, bringing the total IPO to $ 29.4 billion.
These funds were transferred to the Public Investment Fund (PIF), Saudi Arabia's sovereign wealth fund responsible for transforming the economy and moving from fossil fuels to low-carbon energy.
The pandemic has dealt a new blow to the fossil fuel industry, reducing demand.
Saudi Aramco's profits fell sharply last year, but it retained promised $ 75 billion in annual dividends, most of which goes to the government.
Saudi Arabia's Crown Prince Mohammed bin Salman, the de facto ruler of the kingdom, said last month that Aramco will sell more shares in the coming years to fill the coffers.