Saudi Aramco Acquires Peruvian Fuelx Fuels Distributor: Strategic Expansion Moves

Saudi Aramco Eyes South American Expansion with Primax Acquisition

March 21, 2025

Aramco’s strategic Play in the Southern Hemisphere

In a move signaling a notable expansion into the South American market, Saudi Aramco has reportedly agreed to acquire Primax, a fuel distributor owned by Grupo Romero. Primax boasts an extensive network of fuel stations across peru, Colombia, and Ecuador. The potential deal, first reported by the Peruvian newspaper Gestion, highlights Aramco’s ambition to diversify its global footprint and tap into growing energy demands in the region.

While official statements from Aramco, Primax, and Grupo Romero are still pending, the acquisition could represent a pivotal shift in the South American energy landscape. The reported price tag for the Primax operation is around US $3.5 billion, according to Gestion which cited sources familiar with the agreement.

For U.S. readers, this move may seem distant, but it has implications for the global energy market, perhaps affecting fuel prices and supply chains that ultimately impact American consumers. Think of it as similar to ExxonMobil acquiring a large chain of gas stations in Europe; it consolidates market power and influences the broader industry.

Primax: A Regional Powerhouse

Primax has grown from 120 stations in 2004 to 2,185 in 2024. Serving as a major player in the South American fuel distribution sector, Primax operates a network of 2,185 fuel sales stations across Peru, Colombia, and Ecuador, according to Peruvian media reports. This extensive reach positions it as a key link in the region’s energy supply chain.

The company’s business model relies heavily on affiliate partnerships. Reportedly, 81% of their points are operated by affiliated third parties. This strategy allows for rapid expansion and market penetration.

Aramco’s Footprint in Peru

This isn’t Aramco’s first foray into Peru. The Saudi Arabian oil giant has steadily been building its presence in the country’s energy sector. Last year, Aramco acquired a minority stake in the Peru LNG plant, a critical facility for exporting natural and liquefied gas from the andean nation.This acquisition demonstrated Aramco’s interest in peru’s natural gas resources.

Furthermore, Aramco already has operations in Peru through the Midocean company, in which it holds a 49% stake. last year, the multinational invested to finance an additional acquisition in Peru LNG by Midocean Energy.

Primax’s Strong Position in Colombia

Focusing on Colombia, Primax holds a significant market share. With 6,518 service stations in Colombia last year, the company commands a 15.7% share of the national market, according to Comce, a Colombian foreign trade entity. Juan José Martínez, president of Primax in Colombia, stated that since the company’s arrival in 2018, it has “been possible to contribute to the mobilization of the country.” The manager added that the company has a “network of stations that cover all departments.”

Primax stands as the third-largest player in Colombia’s fuel distribution network,trailing only Terpel (2,365 stations) and Biomax (1,053 stations). They achieve annual sales of approximately 663 million gallons of fuel.

Strategic Divestment and Acquisition

Adding another layer to the story, Primax itself was involved in a significant transaction last year.The company announced the disposal of assets and subsidiaries in Peru and Ecuador for US $64 million. Simultaneously occurring, it acquired 100% of Terpel Peru and Terpel Comercial Peru, companies dedicated to liquid fuel and natural gas service stations.It also acquired 100% of Terpel Comercial Ecuador.

According to Primax, “This decision responds to the interest of concentrating on businesses with the greatest potential for growth and profitability in each of the markets where it operates.” This strategic maneuvering suggests that Primax was streamlining its operations to become an even more attractive acquisition target.

Implications for the U.S. Market and Beyond

Aramco’s potential acquisition of Primax has several implications, both regionally and globally:

• Increased Competition: Aramco’s entry into the South American fuel distribution market could intensify competition, potentially leading to lower prices for consumers.
• Investment in Infrastructure: Aramco’s deep pockets could lead to increased investment in upgrading and expanding Primax’s infrastructure, benefiting the region’s energy sector.
• Geopolitical Shifts: This acquisition strengthens Saudi Arabia’s influence in South America, potentially altering the geopolitical dynamics of the region.
• Impact on U.S. Companies: U.S. companies operating in the South American energy market may face increased competition from Aramco.

Addressing Potential Concerns

Some may argue that Aramco’s acquisition of Primax could lead to a concentration of power in the hands of a state-owned oil giant, potentially stifling competition and innovation. There are also concerns about the environmental impact of increased fossil fuel consumption in the region. However, proponents of the deal argue that Aramco’s investment could bring much-needed capital and expertise to modernize the region’s energy infrastructure and improve efficiency.

How might this acquisition impact U.S. fuel prices and the broader energy landscape in the United States?

Saudi Aramco’s Primax Acquisition: An Expert Analysis with Dr. Elena Ramirez

Introduction

Welcome to Archyde. Today, we have Dr. Elena Ramirez, a leading energy market analyst, to shed light on Saudi Aramco’s reported acquisition of Primax, a major fuel distributor in South America. dr. Ramirez,thank you for joining us.

dr. Ramirez: Thank you for having me.It’s a pleasure to be here.

Strategic Meaning of the Acquisition

Archyde: Dr. Ramirez, this acquisition seems like a major move. What are the key strategic benefits for Saudi Aramco?

Dr. Ramirez: Absolutely. For Aramco, this is about diversification and expanding its global footprint. South America offers growth potential and a strategic advantage. Acquiring Primax grants immediate access to a ample network of fuel stations across Peru, Colombia, and Ecuador, solidifying their presence in a growing market.

Primax’s Position in the South American Market

Archyde: Primax has a significant market share, especially in Colombia. How does this impact Aramco’s strategy?

Dr. Ramirez: Primax’s established presence is a huge asset. They have a robust network, notably in Colombia, which provides a strong foundation. The company’s affiliation model, where the majority of stations are operated by third parties, allows for speedy market penetration and scalability. That provides a crucial advantage over starting from scratch.

Implications for the U.S. Market

Archyde: How might this deal impact U.S. consumers and the broader energy market?

Dr. Ramirez: While the direct impact on U.S. consumers might seem indirect, the global energy market is interconnected. The acquisition concentrates market power, influencing global fuel prices and supply chains. increased competition from Aramco in South America can lead to shifts in the global supply of oil and gas,perhaps influencing the prices U.S.consumers pay at the pump.

Aramco’s Existing Presence and Future investments

Archyde: Aramco already has some investments in Peru. Does this acquisition build upon that?

Dr. Ramirez: Yes, exactly. Aramco’s existing stake in the Peru LNG plant and prior investments signal a clear interest in the region’s energy resources. The primax acquisition is a next logical step, and we can anticipate further investments in infrastructure upgrades and expansions of Primax’s operations, with potentially more acquisitions in years to come.

potential challenges and Concerns

Archyde: Are there any potential drawbacks or concerns associated with this acquisition?

Dr. Ramirez: Some concerns revolve around the concentration of power in the hands of a state-owned entity. There’s a risk of stifled competition and potentially less innovation. There are also environmental concerns, as increased fossil fuel consumption could further impact the climate. however, Aramco’s investment could also bring capital and expertise that can improve the efficiency and environmental standards of the region’s energy infrastructure, which is a positive trade-off.

Looking Ahead: Geopolitical and Economic Considerations

archyde: This deal has geopolitical implications. What do you foresee in terms of Saudi Arabia’s influence in South America and the ripple effects?

Dr. Ramirez: This increases Saudi Arabia’s footprint in South America. This could potentially shift the geopolitical dynamics of the region, creating new alliances and potentially impacting trade relationships. For exmaple, if we see more fuel stations with Aramco’s name, then there will be a larger impact on local markets.

Reader Interaction

Archyde: Considering all these factors, do you think this acquisition will ultimately benefit consumers or the oil industry more? Let us know your thoughts in the comments section below!

Dr. ramirez: A complex question, but essential to consider. Thank you.