Saudi Aramco has signed an agreement with National Oilwell Varco (NOV) to form a joint venture partnership to set up an integrated on-shore rig and equipment manufacturing and aftermarket facility in Ras Al-Khair in Saudi Arabia.
Image: The joint venture facility is expected to serve as a major hub for high specification drilling rigs. Photo courtesy of Saudi Arabian Oil Co.
While Saudi Aramco will own 30% stake in the joint venture, NOV will own the remaining 70%.
Located in Ras Al-Khair, near the Jubail Industrial City on the Kingdom’s east coast, the new facility will have a capacity to manufacture 10 onshore rigs per year.
Saudi Aramco new business development executive director and Saudi Aramco Development Company chief executive officer Ziad Al-Murshed said: “The new manufacturing facility will further strengthen the integrated portfolio of oil field services and equipment being developed by the Saudi Aramco Development Company, which also optimizes Saudi Aramco’s supply chain costs and improves its agility.
“This investment will also create employment and training opportunities for Saudi youth.”
The joint venture facility is expected to serve as a major hub for high specification drilling rigs.
Besides, it will offer repair services and recertification of a large portfolio of equipment.
The manufacturing facility will also be equipped to deliver drilling packages for offshore Jack-up rigs.
The Ras Al-Khair rig facility is anticipated to create over one thousand direct and indirect jobs in the Kingdom.
It is expected to be commissioned by 2020, with the delivery of the first rig taking place in 2021.
Al-Murshed said: “Over the past few years, Saudi Aramco has taken major steps to localize oil field services in the Kingdom, starting with drilling services, through establishing two rig operations joint ventures, one for onshore drilling and the other for offshore drilling.
“This joint venture with NOV is a major step toward localizing oil field equipment manufacturing and after-market services, starting with rig manufacturing.”