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Arab News
02-03-2025
- Business
- Arab News
Saudi, UAE drilling giants team up to accelerate international expansion
RIYADH: Saudi-based Arabian Drilling and the UAE-headquartered Shelf Drilling have entered three global tenders as part of their strategic alliance to expand international operations. The partnership, formalized through a memorandum of understanding signed in early February, seeks to leverage Arabian Drilling's fleet of rigs alongside Shelf Drilling's extensive expertise to accelerate global expansion and unlock new market opportunities. Greg O'Brien, CEO of Shelf Drilling, confirmed that the alliance has already begun executing its objectives by bidding for project proposals across different regions. 'We have participated in three different opportunities. We have a longer list of target opportunities,' O'Brien said in an interview with Arab News. He noted that while the alliance is taking an aggressive approach to exploring international prospects, the financial impact of these tenders will likely not be seen until late 2025 or early 2026 due to the time required for rig mobilization and contract execution. Strategic rationale As an international offshore extraction contractor, Shelf Drilling operates in multiple regions and continues to seek expansion opportunities while optimizing costs. O'Brien highlighted that maintaining operational efficiency is a priority, particularly in a competitive market. 'We have 14 rigs right now, all but one of those are contracted, and that one we expect to have contracted really soon, and we see additional opportunities to deploy newer, more capable rigs in other markets where we have a footprint like West Africa and Southeast Asia,' he said. The alliance allows Shelf Drilling to expand its capacity without significant capital expenditure on new assets. 'This alliance with Arabian Drilling gives us access to a few additional rigs that we believe we can deploy in the contract opportunities and markets that we know well without having to buy other assets,' O'Brien stated. For Arabian Drilling, the alliance is a critical step in its broader international growth strategy. The company, which operates 36 rigs, has three currently suspended. O'Brien explained that these three rigs share similarities with those used by Shelf Drilling, making their international deployment more seamless. By leveraging Shelf Drilling's established presence in key markets, Arabian Drilling can re-enter the global scene more efficiently. Talking to Arab News, Ghassan Mirdad, CEO of Arabian Drilling, emphasized that the partnership aligns with the company's long-term ambitions to expand beyond the Kingdom. 'When we go back in time to when we were listed, part of our strategy was to grow outside of Saudi Arabia; it was clearly the intention to grow in the land market, not the offshore,' he said. 'However, with the suspension of rigs, we had to accelerate the expansion out of Saudi Arabia.' The alliance provides Arabian Drilling with the necessary framework to establish a presence in global markets without having to build operations from scratch. 'And this (alliance) is the license to operate outside of Saudi,' Mirdad added. He further underscored the increasing demand for offshore drilling worldwide. 'Today, I can easily name on top of my head four or five countries that are in desired need of offshore jack-ups.' Mirdad noted that while entering these markets independently would require significant investment, partnering with an international player like Shelf Drilling facilitates market access. 'With this alliance, automatically we have the license to operate in all of these rigs, we have the local knowledge that Shelf has, and it gives us access to all the tenders,' he said. Opportunities and plans Several international markets present promising opportunities for new contracts, with West Africa emerging as a key target region. 'India, Southeast Asia, West Africa are markets we know extremely well. West Africa is a place that has a decent number of new projects that are incremental to existing activity in that region, and it's not quite as competitive,' O'Brien said. 'Southeast Asia holds great opportunities as well, but we see a better opportunity margin in West Africa,' he added. Mirdad acknowledged that the alliance's initial three rigs would not be sufficient to meet the growing demand for offshore drilling services. 'When we looked at the opportunities, we, as Arabian Drilling, looked at each other and realized we don't have enough rigs,' he said. He indicated that the company is actively considering further expansion. 'The three rigs are not enough. So, I'm very upbeat to giving the market some good news in the short term,' Mirdad said. When asked about plans for additional rig deployment, he explained that the alliance is a long-term strategic move rather than a short-term fix. 'In the first instance, it might seem like we're doing this alliance to secure these three rigs, which is true, but this alliance is not a short-term fix; it is long-term.' He further highlighted that with a strong balance sheet and growing international demand, Arabian Drilling is well-positioned to explore additional rig deployments beyond the initial three. Financial outlook and growth strategy When asked about the financial impact of the alliance, Mirdad stated that Arabian Drilling's strong balance sheet allows it to focus on growth rather than relying solely on financial maneuvers to expand. 'Our relations with the banks are really good, so access to cash is not a problem for growth, but this is a great avenue for us and Shelf to grow and not to miss out on any international opportunities,' he said. O'Brien added that current oil prices remain at levels that support offshore rig demand, strengthening the alliance's financial rationale. He emphasized that while the primary goal is to establish a broader global footprint, the venture is designed to generate long-term profits for both companies. 'The alliance will definitely aim to generate profit and revenue for both companies, and the approach will be opportunity-specific,' O'Brien said. Global industry trends and long-term demand O'Brien highlighted that the alliance aligns with global trends in the shallow-water drilling market, particularly as demand for offshore rigs remains strong. 'There are about 425 jack-ups around the world, the Middle East is the biggest market, and Saudi Arabia is the largest market for offshore shallow water drilling, but there is stable demand in other parts of the world,' he said. He pointed out that the supply of jack-up rigs in markets outside the Middle East has remained relatively stagnant and is expected to decline in the coming years. This presents an opportunity for drilling contractors to capitalize on increasing demand. 'The supply side in other markets has been flat and would most likely be declining in the years to come, which is a good thing for a drilling contractor,' he added. O'Brien expressed confidence in long-term global oil demand, which will likely drive continued demand for drilling services. 'We believe oil demand will continue to grow around the world for the next five to 10 years, or even more,' he said. Mirdad further explained that new jack-up rigs are rarely built, leading to a gradual phasing out of older rigs and creating a supply gap in the offshore drilling market. 'That means that you'll have demand but not enough rigs available,' he added.
Arab News
02-03-2025
- Business
- Arab News
Saudi-UAE drilling giants team up to accelerate international expansion
RIYADH: Saudi-based Arabian Drilling and the UAE-headquartered Shelf Drilling have entered three global tenders as part of their strategic alliance to expand international operations. The partnership, formalized through a memorandum of understanding signed in early February, seeks to leverage Arabian Drilling's fleet of rigs alongside Shelf Drilling's extensive expertise to accelerate global expansion and unlock new market opportunities. Greg O'Brien, CEO of Shelf Drilling, confirmed that the alliance has already begun executing its objectives by bidding for project proposals across different regions. 'We have participated in three different opportunities. We have a longer list of target opportunities,' O'Brien said in an interview with Arab News. He noted that while the alliance is taking an aggressive approach to exploring international prospects, the financial impact of these tenders will likely not be seen until late 2025 or early 2026 due to the time required for rig mobilization and contract execution. Strategic rationale As an international offshore extraction contractor, Shelf Drilling operates in multiple regions and continues to seek expansion opportunities while optimizing costs. O'Brien highlighted that maintaining operational efficiency is a priority, particularly in a competitive market. 'We have 14 rigs right now, all but one of those are contracted, and that one we expect to have contracted really soon, and we see additional opportunities to deploy newer, more capable rigs in other markets where we have a footprint like West Africa and Southeast Asia,' he said. The alliance allows Shelf Drilling to expand its capacity without significant capital expenditure on new assets. 'This alliance with Arabian Drilling gives us access to a few additional rigs that we believe we can deploy in the contract opportunities and markets that we know well without having to buy other assets,' O'Brien stated. For Arabian Drilling, the alliance is a critical step in its broader international growth strategy. The company, which operates 36 rigs, has three currently suspended. O'Brien explained that these three rigs share similarities with those used by Shelf Drilling, making their international deployment more seamless. By leveraging Shelf Drilling's established presence in key markets, Arabian Drilling can re-enter the global scene more efficiently. Talking to Arab News, Ghassan Mirdad, CEO of Arabian Drilling, emphasized that the partnership aligns with the company's long-term ambitions to expand beyond the Kingdom. 'When we go back in time to when we were listed, part of our strategy was to grow outside of Saudi Arabia; it was clearly the intention to grow in the land market, not the offshore,' he said. 'However, with the suspension of rigs, we had to accelerate the expansion out of Saudi Arabia.' The alliance provides Arabian Drilling with the necessary framework to establish a presence in global markets without having to build operations from scratch. 'And this (alliance) is the license to operate outside of Saudi,' Mirdad added. He further underscored the increasing demand for offshore drilling worldwide. 'Today, I can easily name on top of my head four or five countries that are in desired need of offshore jack-ups.' Mirdad noted that while entering these markets independently would require significant investment, partnering with an international player like Shelf Drilling facilitates market access. 'With this alliance, automatically we have the license to operate in all of these rigs, we have the local knowledge that Shelf has, and it gives us access to all the tenders,' he said. Opportunities and plans Several international markets present promising opportunities for new contracts, with West Africa emerging as a key target region. 'India, Southeast Asia, West Africa are markets we know extremely well. West Africa is a place that has a decent number of new projects that are incremental to existing activity in that region, and it's not quite as competitive,' O'Brien said. 'Southeast Asia holds great opportunities as well, but we see a better opportunity margin in West Africa,' he added. Mirdad acknowledged that the alliance's initial three rigs would not be sufficient to meet the growing demand for offshore drilling services. 'When we looked at the opportunities, we, as Arabian Drilling, looked at each other and realized we don't have enough rigs,' he said. He indicated that the company is actively considering further expansion. 'The three rigs are not enough. So, I'm very upbeat to giving the market some good news in the short term,' Mirdad said. When asked about plans for additional rig deployment, he explained that the alliance is a long-term strategic move rather than a short-term fix. 'In the first instance, it might seem like we're doing this alliance to secure these three rigs, which is true, but this alliance is not a short-term fix; it is long-term.' He further highlighted that with a strong balance sheet and growing international demand, Arabian Drilling is well-positioned to explore additional rig deployments beyond the initial three. Financial outlook and growth strategy When asked about the financial impact of the alliance, Mirdad stated that Arabian Drilling's strong balance sheet allows it to focus on growth rather than relying solely on financial maneuvers to expand. 'Our relations with the banks are really good, so access to cash is not a problem for growth, but this is a great avenue for us and Shelf to grow and not to miss out on any international opportunities,' he said. O'Brien added that current oil prices remain at levels that support offshore rig demand, strengthening the alliance's financial rationale. He emphasized that while the primary goal is to establish a broader global footprint, the venture is designed to generate long-term profits for both companies. 'The alliance will definitely aim to generate profit and revenue for both companies, and the approach will be opportunity-specific,' O'Brien said. Global industry trends and long-term demand O'Brien highlighted that the alliance aligns with global trends in the shallow-water drilling market, particularly as demand for offshore rigs remains strong. 'There are about 425 jack-ups around the world, the Middle East is the biggest market, and Saudi Arabia is the largest market for offshore shallow water drilling, but there is stable demand in other parts of the world,' he said. He pointed out that the supply of jack-up rigs in markets outside the Middle East has remained relatively stagnant and is expected to decline in the coming years. This presents an opportunity for drilling contractors to capitalize on increasing demand. 'The supply side in other markets has been flat and would most likely be declining in the years to come, which is a good thing for a drilling contractor,' he added. O'Brien expressed confidence in long-term global oil demand, which will likely drive continued demand for drilling services. 'We believe oil demand will continue to grow around the world for the next five to 10 years, or even more,' he said. Mirdad further explained that new jack-up rigs are rarely built, leading to a gradual phasing out of older rigs and creating a supply gap in the offshore drilling market. 'That means that you'll have demand but not enough rigs available,' he added.
Arabian Business
19-02-2025
- Business
- Arabian Business
Arabian Drilling, Shelf Drilling sign MoU for global jack-up rig expansion
Arabian Drilling and Shelf Drilling announced the signing of a Memorandum of Understanding (MOU) for a strategic alliance to deploy some of the former's premium jack-up rigs internationally. The collaboration is also aimed at expanding the reach and capabilities of both companies. Under the alliance, Arabian Drilling, the largest onshore and offshore drilling company in Saudi Arabia by fleet size, will gain access to Shelf Drilling's extensive international operating platform and diverse customer relationships. Shelf Drilling, on the other hand, will seek to use some of Arabian Drilling's high-specification jack-up rigs to meet specific contract requirements. By combining resources, technical expertise and operational excellence, the alliance will be positioned to deliver outstanding services to customers and increase the competitiveness of both companies, they said. Ghassan Mirdad, CEO of Arabian Drilling, said the alliance provides the company a clear path to execute its strategy to develop an international footprint. 'Shelf Drilling's expertise and international presence will bring our advanced, high-specification rigs to new markets,' he said. Greg O'Brien, CEO of Shelf Drilling, said the alliance marks a significant step in the company's commitment to delivering operational excellence and best-in-class services to its customers. 'By leveraging Shelf Drilling's extensive international presence, unique focus on safety, and fit-for-purpose business strategy with Arabian Drilling's premium jack-up rigs, we are well-positioned to unlock new opportunities in our core markets and drive value for our stakeholders,' he said. The Oslo Stock Exchange-listed Shelf Drilling is a leading international shallow water offshore drilling contractor with rig operations across the Middle East, Southeast Asia, India, West Africa, the Mediterranean and the North Sea.
Zawya
19-02-2025
- Business
- Zawya
Arabian Drilling, Shelf Drilling form to expand offshore drilling globally
Riyadh: Arabian Drilling inked a memorandum of understanding (MOU) with Shelf Drilling Limited to deploy some of its premium jack-up rigs internationally. The two companies will form a strategic alliance to expand their reach and capabilities, according to a press release. Arabian Drilling will gain access to the UAE-based firm's extensive international operating platform and diverse customer relationships. Meanwhile, Shelf Drilling will seek to use the Saudi company's high-specification jack-up rigs to meet specific contract requirements. Ghassan Mirdad, CEO of Arabian Drilling, said: "We see a strong cultural fit and a common focus on the highest Health, Safety and Environmental standards. The Alliance is an exciting new opportunity to create value." Greg O'Brien, CEO of Shelf Drilling, commented: "By leveraging Shelf Drilling's extensive international presence, unique focus on safety, and fit-for-purpose business strategy with Arabian Drilling's premium jack-up rigs, we are well-positioned to unlock new opportunities in our core markets and drive value for our stakeholders." Last November, the Tadawul-listed company sealed a SAR 290 million deal with Saudi Arabian Oil Company (Aramco).
Zawya
18-02-2025
- Business
- Zawya
Arabian Drilling, Shelf Drilling plan alliance in international markets
UAE - Arabian Drilling and Shelf Drilling have signed a memorandum of understanding (MoU) with the intention of forming a strategic alliance which aims to deploy some of Arabian Drilling's premium jack-up rigs internationally and expand the reach and capabilities of both companies. Arabian Drilling is the largest onshore and offshore drilling company in Saudi Arabia by fleet size. Shelf Drilling is a leading international shallow water offshore drilling contractor with rig operations across the Middle East, Southeast Asia, India, West Africa, the Mediterranean and the North Sea. Under the alliance, Arabian Drilling will gain access to Shelf Drilling's extensive international operating platform and diverse customer relationships. Shelf Drilling will seek to use some of Arabian Drilling's high-specification jack-up rigs to meet specific contract requirements. By combining resources, technical expertise and operational excellence, the Alliance will be positioned to deliver outstanding services to customers and increase the competitiveness of both companies, said a statement. Ghassan Mirdad, CEO of Arabian Drilling, commented: "The alliance gives us a clear path to execute our strategy to develop an international footprint. Shelf Drilling's expertise and international presence will bring our advanced, high-specification rigs to new markets. We see a strong cultural fit and a common focus on the highest health, safety and environmental standards. The alliance is an exciting new opportunity to create value." Greg O'Brien, CEO of Shelf Drilling, commented: "The alliance marks a significant step in our commitment to delivering operational excellence and best-in-class services to our customers. By leveraging Shelf Drilling's extensive international presence, unique focus on safety, and fit-for-purpose business strategy with Arabian Drilling's premium jack-up rigs, we are well-positioned to unlock new opportunities in our core markets and drive value for our stakeholders." -TradeArabia News Service Arabian Drilling was established in 1964 and is the leader in the drilling sector in Saudi Arabia with a large fleet of onshore and offshore rigs for oil and gas. The founders and majority shareholders of the company are: Industrialization & Energy Services Company (TAQA), a Saudi joint stock company and SLB (previously known as Schlumberger), a global leader in oilfield services. Arabian Drilling serves clients including Aramco, Al-Khafji Joint Operations (KJO), SLB and Baker Hughes. The company is listed on the Saudi Stock Exchange. Copyright 2024 Al Hilal Publishing and Marketing Group Provided by SyndiGate Media Inc. (
