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Saudi Aramco signs agreement with McDermott Arabia for new fabrication facility

The facility is expected to be operational by 2022

Saudi Aramco has inked a land lease agreement with McDermott Arabia Company. The agreement will enable the development of a fabrication facility located within the King Salman International Complex for Maritime Industries, in the Ras Al Khair region of the Kingdom.

The facility will be located near the Jubail Industrial City on the Kingdom’s east coast. It will cover an area of 1.15m sqm and will utilise ‘cutting-edge technologies to ensure world-class standards in safety, quality and efficiency’.

The deal is in accordance with a MoU signed between Saudi Aramco and McDermott. According to a statement, the facility will be used for large-scale fabrication of offshore platforms and onshore/offshore modules.

“This facility will serve as a major engineering, procurement, construction, and installation (EPCI) hub for not only the Kingdom but for the GCC region” said Ahmad Al Sa’adi, SVP of technical services at Saudi Aramco.

McDermott said it will also grow its engineering and procurement offices in Saudi, as well as establish a new marine base in the Eastern Province, to support the installation of offshore platforms, subsea pipelines and cables, skids, and associated structures and assemblies. The firm say the move will enhance its overall project execution capabilities in the Kingdom.

“Having this facility with International Maritime Industries (IMI) in the King Salman International Complex for Maritime Industries offers an integrated portfolio of maritime products and services. The localisation of these capabilities will contribute to diversifying the economy, create almost 7,000 jobs, and achieve a target of 60% Saudisation by 2030,” added Mohammad Al Assaf, Saudi Aramco vice-president of New Business Development.

Saudi Aramco said the facility will have a production capacity in excess of 60,000 million tonnes per year, when operating at peak output. According to a statement, the facility will localise expertise in multiple disciplines related to the industry and is expected to create a significant number of direct and indirect job opportunities in the country.

David Dickson, McDermott’s president and CEO commented, “Expanding our fabrication capacity in Saudi Arabia demonstrates McDermott’s commitment to the Kingdom’s Vision 2030 objectives. We will establish a world-class fabrication facility that enables us to better serve the needs of Saudi Aramco and other customers in Saudi Arabia and across the region,” noted Linh Austin, McDermott SVP for the Middle East and North Africa.

Apprenticeship and training programmes will also be provided to ensure that a sufficient number of qualified nationals are available for hire to meet requirements in the Kingdom.

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