https://arab.news/ja8fe
RIYADH: Saudi exploration service provider ADES Holding Co. has secured a SR2.42 billion ($645.3 million) deal for six onshore drilling contracts with Kuwait Oil Co., marking an expansion of its operations.
ADES specified that the award includes new agreements for four existing operating rigs in Kuwait and two newly constructed units, according to a release to Tadawul.
The contracts are slated to commence in the second and third quarters of 2025, with a firm five-year duration and an optional one-year extension.
Mohamed Farouk, CEO of ADES Holding, said: “Securing such long-term contracts not only adds to the sustainability of our backlog and visibility of our business but is also a testament to ADES’ exceptional safety and operational performance, which will see us triple the size of our contracted fleet in Kuwait from four to 12 rigs upon deployment in 2025.”
He added: “With these new awards, ADES has further solidified its position in the niche Kuwaiti onshore market, characterized by high barriers to entry and deep drilling deployments where ADES has consistently proven its abilities.”
All six contracts are designated for deep drilling rigs in the 3,000-horsepower category, a niche market segment experiencing notable growth in Kuwait.
The estimated backlog for these contracts stands at SR2.42 billion, encompassing both the firm and optional periods.
In just 24 months, the company has seen a three-fold increase in its contracted fleet with Kuwait Oil Co.
This growth trajectory is particularly striking, rising from four rigs in early 2023 to an anticipated 12 rigs by 2025.
ADES operates 10 onshore rigs with KOC in Kuwait, emphasizing the company’s strengthened presence and strategic alignment with Kuwait’s energy sector objectives.
In May, ADES expanded its regional footprint by sealing two contracts worth SR511 million, highlighting its growing influence in the oil and gas sector.
The company signed a deal with TotalEnergies to operate an offshore drilling platform in Qatar valued at up to SR350 million. The agreement includes a mandatory one-year period with an option to extend it for up to an additional 18 months, according to a bourse filing.
Operations are slated to begin in the second half of 2024. The company emphasized that no related parties were involved in this agreement.
Moreover, ADES announced in a separate release that it was awarded a 21-month contract to employ an elevated platform in the Gulf of Suez. The company received a direct award letter from the Suez Oil Co, also known as SUCO, in Egypt, with operations expected to commence in the coming weeks. In a statement on Tadawul, the company disclosed that the deal is valued at SR161 million.
This new engagement in Egypt is part of ADES’s broader regional strategy to reactivate its operations. It follows recent contracts in Thailand and Qatar, bringing the total number of reactivated platforms to three of the five recently suspended in Saudi Arabia.