Oil Company Budget

Introduction and Company Background

This paper offers a brief overview of the budgeting process as used by the Ras Tanura Refinery, part of the Saudi Aramco Oil Company. The name Ras Tanura applies both to a gated Saudi Aramco employee compound (also referred to as "Najmah") and to an industrial area further out on the peninsula that serves as a major oil port and oil operations centre for Saudi Aramco, the largest oil company in the world.

Saudi Aramco, officially the Saudi Arabian Oil Company, is a Saudi Arabian national oil and natural gas company based in Dhahran, Saudi Arabia. Saudi Aramco was estimated to be worth $781 billion in 2005 making it the world's most valuable company. ("Big Oil, bigger oil". Financial Times. February 4, 2010 / HELMAN, Christopher (July 9, 2010). "The World's Biggest Oil Companies". Forbes.)

Saudi Aramco has both the largest proven crude oil reserves, at more than 260 billion barrels, and largest daily oil production. Headquartered in Dhahran, Saudi Arabia, Saudi Aramco operates the world's largest single hydrocarbon network, the Master Gas System. Its yearly production is 7.9 billion barrels and it managed over 100 oil and gas fields in Saudi Arabia, including 279 trillion standard cubic feet of natural gas reserves. Saudi Aramco owns the Ghawar Field, the world's largest oil field, and the Shaybah Field, one of the world's largest oil fields.

Most authors agree that the logical place to start when formulating a budget is with the vision and mission of the company. It lays down the broad brush strokes or essence of the budget which will be detailed later by supporting facts and figures. Aramco’s vision for the future is best described through the company’s 2020 Strategic Intent:

Become a leading global chemicals and refining company. Promoting an energy efficient economy, developing alternative energy options, and building a technology portfolio. Delivering an agile, flexible, and efficient organization to achieve...