SAUDI ARAMCO

Saudi Aramco



Saudi Aramco

Introduction

This case tries to identify the different kinds of operational issues that can arise at the best of the organizations in the world. Furthermore, this paper will also try to analyze the steps the steps that can be taken in such situations, in order to overcome such issues.

Saudi Aramco is the national carrier Saudi Arabian oil (its name is a contraction of Arabian American Oil Company) (Adelman, 1972, p. 56-79). It has almost all of the hydrocarbon resources of the kingdom and, in terms of its reserves as that of its production is by far the largest oil company worldwide. It has the headquarter is in Dhahran, in the eastern part of the country (Manuel, 2001, p. 78-89). Its premier oil field is Ghawar, the world's largest deposit. The history of Saudi Aramco begins from May 29 in 1933, when the Saudi government signed a concession agreement with Standard Oil of California (Socal) allowing it to make oil exploration in Saudi Arabia. Standard Oil of California passes this grant to one of subsidiary called California-Arabian Standard Oil. In 1936, having no success, the Texas Oil Company purchased 50% of the concession (Manuel, 2001, p. 78-89). After four extended years of fruitless search, the company discovered a first deposit at Dhahran in 1938; the well, called "Dammam number 7". The company name changed in 1944 and became Arabian American Oil Company (Aramco) (Bamberg, James, 2000, p. 111-119).

In 1948, Standard Oil of California and Texas Oil Company welcome a new partner. Standard Oil of New Jersey takes 30% of Aramco, and Socony Vacuum acquires 10%, leaving an equal share of 30% Standard Oil of California and Texas Oil Company. In 1973, the Saudi Government acquired 25% stake in Aramco to increase to 60% in 1974, and ultimately take full control in 1980. In November 1988, the company changed its name to Arabian American Oil Company in Saudi Arabian Oil Company (or Saudi Aramco) (Bamberg, James, 2000, p. 111-119). It is currently working to build the University of Science and Technology of King Abdullah. The refinery Ras Tanura, near Dhahran, was long the only one in the country. Saudi Aramco promotes an annual of 525 million tons of oil and thus about four times as much as rival ExxonMobil. The oil reserves of Saudi Aramco and Saudi Arabia amounted to 35-36 billion tons more (Bowden, 1985, p. 207-240).

With an estimated enterprise, value of 781 billion dollars of Saudi Aramco was loud McKinsey in December 2005, the most valuable company in the world. With the Ghawar oil field, owns the largest oil field in the world. It is according to the peak oil suspected theory that this oil field has reached its production peak and begun to produce annually about eight percent less crude oil (Bromley, 1991, p. 234-257). Abdallah Dschum, CEO of Saudi Aramco (2008) hold but, the Fears to the global production peak for drastically exaggerated. Aramco announced in early 2008, from a quarter of the shares at the ...