#Saudi Aramco battles energy ministry over expenses | Financial Times

Saudi Aramco battles energy ministry over expenses | Financial Times:

Saudi Aramco is taking steps to clarify its financial links with the kingdom’s energy ministry in a move designed to shield the state oil company from legal risks and head off investor criticism ahead of a potential listing.

One of the thorniest issues involves reining in the company’s tradition of paying for ministerial expenses — including those incurred by current energy minister Khalid Al Falih, who is also Aramco’s chairman, said people with knowledge of the initiative, speaking on the condition of anonymity. The move is part of a broader push to improve governance and draw a line between the finances of the company and the ministry, which could force Mr Falih to step down as chairman, according to four of them.

For years, Aramco — which reported net income of $111bn last year, making it the world’s most profitable oil company — has paid for ministry-related expenses, generously supplementing a finance ministry budget allocation. This includes Mr Falih’s stays in ultra-luxury hotel suites and the use of one of the company’s Gulfstream jets, as well as salaries of some government staff.