Saipem shares rise after $2bn contract win from Saudi Aramco for Marjan field

Saipem, the Italian energy services giant, saw its shares rise by 2.5% after securing a major $2 billion offshore contract from Saudi Arabian Oil Company (Saudi Aramco). The contract, under the Long-Term Agreement (LTA), involves developing the Marjan field, a critical asset in Saudi Arabia’s offshore oil and gas production strategy. Saipem’s project scope includes engineering, procurement, construction, and installation of several offshore infrastructures, including wellhead platforms and submarine cables.

The Marjan field, located in the Arabian Gulf, is one of the largest oilfields in Saudi Arabia. Saipem’s involvement aims to increase the oilfield’s production capacity, which aligns with Saudi Aramco’s broader objective of expanding energy output. The project will see Saipem deploying its advanced offshore fleet, which includes dynamic positioning vessels, and utilising cutting-edge welding technology to execute the tasks.

Saipem’s focus on local content will also see fabrication activities carried out at the Saipem Taqa Al-Rushaid Fabricators Co. Ltd (STAR) facility in Dammam, further strengthening the local supply chain in Saudi Arabia. This latest contract builds on Saipem’s history of collaboration with Saudi Aramco, having won $1 billion in contracts across Saudi fields such as Zuluf and Safaniyah earlier this month.

Expert Opinion: Saipem’s Strong Position in the Middle East Energy Market

Saipem’s contract win from Saudi Aramco reinforces its dominant position in the Middle East energy sector. Experts note that this is not only a testament to Saipem’s expertise but also a reflection of the company’s strategic alignment with Saudi Arabia’s ambitious oil and gas expansion projects. Saipem has been adept at leveraging its technological capabilities and fostering local partnerships, making it a preferred contractor for large-scale offshore projects in the region.

The Marjan field project is expected to contribute significantly to Saudi Arabia’s overall energy strategy. With the Middle East continuing to invest heavily in energy infrastructure, Saipem’s role in this sector is pivotal, providing the company with a strong foothold in the region’s energy future.

Recently, Saipem bagged an offshore Engineering, Procurement, and Construction (EPC) contract by QatarEnergy LNG, valued at approximately 4 billion USD. The contract is for the Combined COMP3A & COMP3B of the North Field Production Sustainability Offshore Compression Programme, intended to sustain the production capacity of the North Field offshore natural gas reservoir, located off the north-east coast of Qatar.