Investment Case

As a pure-play base oil producer, Luberef holds a distinctive place in the regional and global industrial and lubricant landscape. Purpose-built facilities, deep technical expertise, and integration within Saudi Aramco’s network enable the company to operate at scale while maintaining a sharp focus on product quality, efficiency, and market responsiveness.

Pure-play focus Dedicated facilities optimized exclusively for base oil production, unlike integrated refiners where base oils are a secondary output. This allows Luberef to operate at higher utilization rates throughout the year.

Distinct market position With a production capacity of 1.455 million MT per annum, Luberef is the only virgin base oil producer in Saudi Arabia, and among the largest in the Middle East.

Flexible production capacity The Yanbu Growth II Expansion is set to enhance capacity and flexibility across Group I, II, and III base oils.

Global reach through the Aramco Base Oil Alliance Strategic collaboration with Saudi Aramco, S-Oil, and Motiva provides access to key markets worldwide.

Luberef’s value proposition is built on efficiency, reliability, and enduring partnerships. Its integrated supply chain and operational excellence ensure cost-effective production, while long-standing customer relationships and a prime geographic position support consistent global demand.

Long-term feedstock security Reliable supply of high-quality, highly paraffinic feedstock from Saudi Aramco supports consistent production, cost competitiveness, and optimal base oil yields.

Operational excellence High mechanical availability and optimized utilization drive industry-leading efficiency. This excellence results in production costs which are lower than global peers, excluding feedstock.

Logistical advantage Red Sea facilities offer fast, cost-effective access to major export markets. Meanwhile, the alliance with Saudi Aramco, Motiva, and S-OIL are another key value driver in this area.

Aramco ecosystem Operating within Saudi Aramco’s ecosystem provides Luberef with access to world-class expertise, global best practices, and strong commercial networks, enhancing its competitiveness and long-term business stability.

Trusted partnerships Luberef has cultivated over 160 years of combined relationships with its top five business partners, reflecting the Company’s long-standing commitment to trusted, strategic partnerships. The 20-year ULSD supply agreement with Aramco, covering up to 6,500 barrels per day from the Yanbu facility, further demonstrates this strength. Strategic collaboration with Saudi Aramco, S-Oil, and Motiva provides access to key markets worldwide.

Decades of disciplined expansion have positioned Luberef for the next phase of growth. The Company continues to align its investments with market dynamics, focusing on higher-value base oils and emerging industrial applications that reflect global shifts toward advanced lubricants and cleaner technologies.

Track record of expansion Major growth initiatives have increased production capacity and operational flexibility, including the Yanbu Growth I Expansion, which introduced Group II base oils and raised production capacity to 710,000 MT, later increasing further to 910,000 MT.

Positioned for future demand Growing global demand for Group II and III base oils supports Luberef’s ongoing expansion. The recent 20-year land lease extension for the Yanbu facility secures the site for long-term capacity growth, while the LubeHub initiative enhances downstream integration and supports the development of a regional ecosystem for lubricant manufacturing.

Innovation-driven development Continuous investment in process improvement and technology enhances Luberef’s competitiveness, demonstrated by major turnaround programs that upgrade assets and prepare operations for Group III base oil production.

Through prudent financial management and disciplined capital allocation, Luberef continues to deliver sustainable returns while maintaining operational resilience and efficiency.

Prudent capital structure A conservative balance sheet with a gearing ratio of -10%, well below the target range of 25-35%, ensures financial stability, liquidity, and capacity for long-term value creation.

High cash conversion and return on capital Strong cash conversion of 93% and a Return on Average Capital Employed (ROACE) of 21% demonstrate effective capital utilization and consistent value creation.

Efficient asset base Preventive maintenance and disciplined asset management help keep maintenance Capex low, reflected in a sustaining Capex ratio of 3% of PPE. At the same time, a Return on PPE of 17.2% and a mechanical availability rate of 99.1% demonstrate efficient capital utilization and the reliability of Luberef’s asset base.

Strong cost discipline Operational efficiency and capital prudence continue to support profitability and long-term shareholder returns.

Sustainability and responsible governance are embedded in Luberef’s operations, guiding its approach to safety, environmental stewardship, and community engagement.

Environmental stewardship Committed to enhancing environmental performance through efforts to reduce emissions, improve resource efficiency, and limit flaring.

Robust governance framework Transparent, independent governance aligned with international best practices.

Experienced leadership A skilled management team ensures accountability and continuous improvement.

Social responsibility Commitment to safety, inclusion, and positive community impact.