Saudi Finance Minister Mohammed al-Jadaan revealed that the Kingdom could save over $200 billion over the next decade by replacing liquid fuel used for domestic consumption with gas and renewable energy sources.
Saudi Arabia, which is the world's top oil exporter, has embarked on an ambitious reforms program in recent years to modernize its economy, create jobs, and reduce its dependence on oil revenues.
“One initiative we're about to finalize is the displacement of liquids,” Reuters cited Jadaan as saying.
“This program would represent savings for the government of about SAR 800 billion ($213.34 billion) over the next 10 years which can be utilized for investment.”
The Kingdom has signed power purchase agreements with seven new solar projects, part of plans to optimize the energy mix used for electricity production.
“Instead of buying fuel from the international markets at $60 and then selling it at $6 for Saudi utilities or using some of our quota in OPEC to sell at $6, we're going to actually displace at least 1 million barrels a day of oil equivalent in the next 10 years and replace it with gas and renewables,” said Jadaan.
The Kingdom has recently announced plans to accelerate domestic investment, in a multi-trillion-dollar spending push led by state oil giant Aramco (2222.SE) and the powerful $400 billion sovereign fund, Public Investment Fund.
“Between now and 2025, and possibly until 2030, fiscal sustainability is a priority for us. We believe that until we achieve all the targets that Vision 2030 has set, we need to maintain fiscal sustainability and control government expenditure,” said Jadaan.
“We are maintaining our unemployment target for 2030 but because we are not out of the woods, yet it is very difficult to say what the unemployment rate is going to be for 2021,” said Jadaan.
“Our aim is to reduce the number so we will end up the year below where we ended up in 2019, pre-Covid, but I can't tell you this is going to happen for certain.”
