Saudi Aramco, the state-controlled oil giant, is interested in acquiring a minority stake in the renewable energy division of Spanish oil company Repsol, Spanish newspaper Expansion has reported.

This development comes as Repsol seeks investment partners for its wind farms and solar plants, aligning with its strategy to transition towards renewable and low-carbon ventures.

Repsol Renewables, which encompasses these assets, has been valued at €5.9bn, including debt, as per a UBS research note from April, according to Reuters.

The interest from Saudi Aramco was first reported by the Spanish newspaper, which indicated that the Saudi company’s focus is particularly on Repsol’s renewable assets in the US.

Although no formal offer has been made, Repsol has initiated discussions for selling a stake in its renewable energy business.

This follows an unsolicited investment proposal, with Santander being appointed as the advisor for the potential sale.

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Previously, Repsol divested a 25% share of its renewable business to Credit Agricole and Energy Infrastructure Partners, raising €905m.

Neither Saudi Aramco nor Repsol offered comments on the matter.

Last month, while reporting its first quarter results for 2024, the company said that it plans to invest between €3bn and €4bn net to organically develop its global portfolio of renewable projects.

In May 2023, El Confidencial reported that Repsol is planning to offload a 49% stake in its renewable projects located in Spain.

The company’s renewable portfolio in Spain exceeds 3.2GW, with approximately half of that capacity currently operational.

Repsol’s ambition is to reach 6GW of global installed capacity by 2025 and expand to 14GW by 2030.

Repsol’s renewable operations span across Spain, Portugal, Italy, Chile, and the US. In support of these goals, the European Investment Bank extended a loan of €575m to Repsol in July las year for developing wind and solar projects in Spain, which will contribute an additional capacity of 1.1GW.