Saudi Arabia's capital market regulator has approved an application for IPO of nearly 30% of Saudi Aramco Base Oil Co., a unit of the state-controlled oil producer.

In a statement published on its website on Thursday, the Saudi Capital Markets Authority said the refining company, known as Lubaref, plans to sell 50,045,000 shares representing 29.656% of its share capital. Lubaref’s prospectus with details of the offering will be released at a later date, the regulator added.

While no date has been indicated for the share offering, the CMA's approval on the application is valid for six months from the date of the resolution.

Lubaref, a joint venture between Saudi Aramco and Jadwa Industrial Investment Group, owns and operates two base oil refineries in the kingdom.  A Bloomberg report in April suggested the IPO could raise more than $1 billion. The plan is to sell 30% percent stake owned by Jadwa Investment, the report said then.

(Writing by Brinda Darasha; editing by Seban Scaria)