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SAUDI ARABIA - The Private Placements.

Article Excerpt
Private Saudi businesses have built up an impressive overseas presence, ranging from the upstream end to oil refining and distribution. They are linked to the Saudi royal family in one way or another. Their downstream acquisitions abroad are seen as a backdoor way for Saudi oil and refined products to penetrate markets where Saudi Aramco has no presence, such as South America, Central Asia and Russia.

Saudi businessmen are generally cautious in their approach; and deals with foreign partners are reached without publicity. The main private operators involved in overseas upstream and downstream activities are the following:

Nimir Petroleum Co. Ltd (NPC): Nimir is incorporated in Bermuda and is involved in petroleum projects in Azerbaijan, Colombia, Indonesia, Oman, Kazakhstan, Russia, Tunisia, Venezuela and Yemen. Established in August 1991, it has rapidly built up branches registered in Bermuda, the Cayman Islands, Cyprus, Russia and the US. Nimir's owners are the Bin Mahfouz family of Jeddah, a well connected clan in Saudi Arabia, which originates from Hadhramaut in Yemen. It has an array of businesses inside and outside the kingdom. This family used to be referred to as the banker of the Saudi royals, because it used to control the National Commercial Bank (NCB), the largest bank in Saudi Arabia. But in May 1999 the state acquired 50% of NCB, removing from control the bank's chairman and CEO Khalid Bin Mahfouz.

Nimir, in Arabic meaning "tiger", was founded by Abdel Rahman and Sultan Bin Mahfouz. Khalid Bin Mahfouz is said to be overseeing its operations. The President and CEO of Nimir is Dr. Abdullah Mohammed Basodan, who originates from Hadhramaut and was previously in Saudi Aramco's planning department and an advisor to the oil ministry. Basodan is also a member of the board of Capital Investment Holdings of Bahrain, a firm controlled and chaired by Khalid Bin Mahfouz. Saudi Defence Minister Prince Sultan Ibn Abdel Aziz and his younger full-brother Prince Salman (emir of Riyadh) are said to have a stake in Nimir.

Operating and service companies in NPC include Nimir Petroleum Co. Europe Ltd. (NPCEL), Nimir Petroleum Co. USA Inc (NPC USA), Hocol (for Latin American operations) and Nimir Energy Services Ltd. (NESL). NPCEL, registered in Bermuda, identifies business opportunities for NPC.

NPCEL is based in Paris. NPC USA Inc. operates out of Dallas. Its job is to manage procurement and shipment of materials to NPC operations on Russia's Far Eastern island of Sakhalin and in Colombia. It provides administrative and human resource services to Petrosakh Joint Stock Co., another Nimir...