Saudi Aramco and US firm National Oilwell Varco (NOV) have entered a deal to form a joint venture (JV) to set up an integrated onshore rig and equipment manufacturing and aftermarket facility in Ras Al-Khair, Saudi Arabia.
The agreement is intended to bolster Saudi Aramco’s integrated portfolio of oilfield services and related equipment.
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Aramco will have 30% ownership in the JV, while NOV is set to hold the remaining 70% shares under the arrangement.
The facility will possess a manufacturing capacity of ten onshore rigs a year and is expected to serve as a major hub for high-specification drilling rigs featuring advanced technologies.
Saudi Aramco New Business Development executive director Ziad Al-Murshed said: “The new manufacturing facility will further strengthen the integrated portfolio of oilfield services and equipment being developed by the Saudi Aramco Development Company, which also optimises Saudi Aramco’s supply chain costs and improves its agility.
“This investment will also create employment and training opportunities for Saudi youth.”
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By GlobalDataAccording to the company, the planned facility will offer repair services and recertification of equipment, as well as drilling packages for offshore jack-up rigs.
In addition, the site is anticipated to localise expertise in a variety of areas related to onshore rig manufacturing.
Aramco expects the new hub to generate more than 1,000 direct and indirect jobs in Saudi Arabia.
The facility is scheduled to be commissioned by 2020 and is currently slated to deliver its first rig in 2021.
The agreement also covers the establishment of an education centre, which will be used to train Saudi technicians in the maintenance and operation of sophisticated drilling technology.
NOV noted that the JV will be supported by the Saudi Aramco Nabors Drilling Company’s commitment to purchasing a total of 50 onshore drilling rigs over a ten-year period.
The JV will provide NOV with access to the Saudi Arabia, Gulf Corporation Council (GCC), and Middle East and North Africa (MENA) markets, while also developing capabilities to support Aramco’s future drilling plans within Saudi Arabia.
