Saudi Aramco, the state-owned energy giant, is considering spinning out its gas business as output from the Jafurah field ramps up, according to a report from the Financial Times. The plan, internally dubbed “Project Gamma,” could separate gas operations and any future gas exports, citing people familiar with the matter.
Jafurah, which began production in 2025, is expected to lift Aramco’s gas output by 80% from 2021 levels by the end of the decade. That would make gas a much larger slice of the company’s overall business than it has been historically. The report suggests a carve-out wouldn’t necessarily mean an immediate initial public offering, but it could create standalone reporting or ownership that makes performance, spending, and returns easier to track.
Beyond gas, Aramco is also exploring ways to unlock value from other non-core assets such as real estate, power, water, and oil storage. That suggests a broader push to show investors what each piece of the sprawling company is worth.
Why Aramco is doing this
Aramco has long been valued primarily as an oil producer, with its vast reserves and production capacity dominating the investment narrative. But as the world gradually shifts toward cleaner energy, gas is increasingly seen as a transition fuel, and Aramco has been investing heavily in expanding its gas business. The Jafurah field, one of the largest unconventional gas projects in the world, is central to that strategy.
By separating gas from the rest of the company, Aramco could give investors a clearer picture of the value of its gas assets, which may be undervalued when lumped together with oil. A standalone gas business could also attract different types of investors, including those focused on energy transition or infrastructure.
The move is part of a broader trend among large energy companies to streamline their portfolios and highlight the value of individual business lines. Other firms have also been divesting non-core assets to sharpen their focus and return cash to shareholders.
What it means for investors
For everyday investors, the key takeaway is that Aramco is trying to change how the market values its shares. Currently, oil and gas sit in one set of financials, and analysts often apply a single “group” valuation. Splitting out gas — even just through clearer standalone accounts — gives analysts a cleaner input for a sum-of-the-parts approach, where different businesses get valued on different assumptions, such as how much they need to spend to grow, how long contracts run, and how flexible exports are.
If gas becomes a distinct, measurable earnings stream alongside the other assets Aramco wants to monetize, the company’s equity story could shift from one blended oil-and-gas multiple toward a clearer “oil + gas + other” breakdown. That can change how investors compare Aramco’s long-term cash flows with other integrated energy majors, and what risks they apply a discount for.
For example, gas businesses often have longer-term contracts and more predictable cash flows than oil, which could justify a higher valuation multiple. On the other hand, gas is still a fossil fuel, and investors concerned about climate change may apply a discount. The net effect on Aramco’s share price is uncertain, but the move is likely to make the company’s valuation more transparent.
The broader push to unlock value from real estate, power, water, and oil storage assets could also lead to asset sales or partnerships that generate cash for Aramco. That cash could be used for dividends, buybacks, or new investments, all of which are closely watched by shareholders.
What to watch next
Investors will be watching for official confirmation from Aramco and any details on the structure of a potential gas carve-out. Key questions include whether Aramco will list a minority stake in the gas business, how it will value the assets, and what it plans to do with the proceeds.
Also worth watching is how the Jafurah ramp-up progresses. If output meets expectations, gas could become a significant profit center for Aramco, making the case for a separate listing stronger. Conversely, any delays or cost overruns could dampen enthusiasm.
The broader energy market backdrop will also matter. Oil prices have been volatile, and weak oil prices have weighed on markets recently. A stronger gas business could help Aramco diversify its revenue streams and reduce its reliance on crude.
For now, the news is a signal that Aramco is thinking strategically about its portfolio. Whether it leads to an IPO or just better reporting, it could make the company easier to understand and value. That is generally a positive for investors, who often struggle to assess conglomerates with many moving parts.
As always, it’s important to remember that these are early-stage discussions, and no final decisions have been made. But the direction is clear: Aramco wants to show investors what its gas business is worth, and it’s willing to restructure to do it.
