Today, post-trade oil blockchain platform VAKT announced a $5 million investment from Saudi Aramco Energy Ventures (SAEV). Additionally, Aramco Trading Company will join the platform as a user.
With SAEV’s investment, VAKT will now have 13 shareholders. The capital will be used to develop the platform further and expand it into Asian markets. VAKT is currently live in North Sea crude oil trades and is already processing more than 90% of the total transactions. Aramco Trading will bring its own North Sea trading volumes, further boosting the platform.
“This company (Aramco) – part of the most profitable business in the world – has a strong track record of investing in industry innovation,” said Richard James, CFO of VAKT. “We were not proactively seeking further investors; however, we could not miss the chance to bring on-board a partner of this caliber, which is a tremendous show of faith in VAKT’s vision.”
Saudi Aramco is one of the largest companies in the world by revenue and recently had an IPO of 1.5% of its stock, giving the entire organization a valuation of $2 trillion.
Meanwhile, the VAKT platform is using blockchain to digitalize post-trade documents. It is underpinned by Quorum, JP Morgan’s version of Ethereum. VAKT is being used to manage the trade cycle right from entry to the final settlement and eliminates lengthy reconciliation and paper-based processes.
The full list of shareholders includes Shell, BP, Chevron, Total, Reliance Industries, Equinor, Gunvor, Mercuria, Koch Industries, ABN Amro, ING, and Societe Generale.
“VAKT has demonstrated that their platform has the potential to digitize what is currently a very manual process and be truly transformative to end users and customers,” said Hans Middelthon, MD of SAEV Europe.
“Leveraging blockchain theory and applying it to the complicated world of post-trade processing, VAKT has made a compelling pitch to become an integral part of market infrastructure.”
VAKT shares seven shareholders with the trade finance blockchain komgo. The Komgo platform integrates with VAKT, and the two have a strategic collaboration agreement in place.
The OOC Oil & Gas Blockchain Consortium is another initiative spearheaded by Chevron, Shell and Exxon. The OOC project is more focused on the upstream sector of the industry.