Saudi Aramco: new partnerships

Saudi Aramco: new partnerships

Aramco, KBR sign supply chain deal

The IKTVA programme will enable the Saudi state oil company to achieve at least 70 per cent of its procurement spending within the kingdom’s supply chain by 2021

September 2017

Saudi Aramco signed an agreement with one of its key strategic partners Kellogg Brown & Root (KBR), aiming to develop a competitive and reliable local supply chain through its In-Kingdom Total Value Add (IKTVA) programme.

Hosted by Saudi Aramco president and CEO Amin Nasser, the memorandum of understanding (MoU) signing was the latest major milestone for the ambitious IKTVA programme, which strives to expand business operations that help drive value creation and maximise long-term economic growth, diversification, job creation, and workforce development to support a rapidly changing business environment.

The programme will enable the company to achieve at least 70per cent of its procurement spending within the kingdom’s supply chain by 2021.

With Saudi Arabia’s Vision 2030 plan, IKTVA is part of a broad-based effort to strengthen and diversify the Saudi economy, through the localization of key manufacturing and service industries within the kingdom, and the creation of thousands of new jobs for talented young Saudi citizens.

Nasser and KBR’s president and CEO, Stuart Bradie, signed the MoU in the presence of technical services senior vice president Ahmad A Al Sa’adi, procurement and supply chain management acting executive director Mohammed Al Shammari, as well as KBR’s president of Engineering and Construction for the Middle East and North Africa, Jay Ibrahim.

By signing the MoU, KBR has committed itself to a five-year action plan to expand and develop KBR’s physical and human capital within the Kingdom to promote Saudi Aramco’s interests in creating and maintaining a reliable local supply, as well as fortifying the local economy through localising goods and services.

The IKTVA action plan will help to ensure that KBR remains compliant with the IKTVA programme and will aid Saudi Aramco in meeting the 2021 objectives.

The action plan includes provisions for cooperation between the two companies, including the sharing of information to help Saudi Aramco monitor KBR’s compliance with the IKTVA action plan, as well as provisions for business development, in which both parties can seek opportunities to expand their current business relationship.


Meanwhile, Saudi Aramco signed a contract with a consortium comprising Saudi Archirodon Company and Huta Hegerfeld Saudia Company for dredging, reclamation and marine structures for King Salman International Complex for Maritime Industries and Services in Ras Al Khair.

The contract is the first major deal for the maritime complex where contractors will conduct dredging and reclamation of approximately 37 million cu m of fill, in addition to ground improvement over an area of 7.4 million sq m. The contract will also provide for constructing 4,500 linear metres of concrete quay walls and wharves, in addition to 12,000 linear metres of rock revetments and breakwaters to protect the integrity of the complex.

“It is an important milestone for King Salman International Complex for Maritime Industries and Services, the largest of its kind in the region.” said Ahmed Al Sa’adi, Saudi Aramco’s senior vice president for technical services.

“The complex is in line with the kingdom’s economic diversification objectives, it will position the kingdom as a strategic logistics hub and will create vast job opportunities,” he said.

Execution of the initial phase of the contract will be completed by 2020. It is instrumental for the whole programme as it will prepare the project’s land for subsequent construction of a dry dock and ship building and maintenance facilities, the statement said.

The complex was launched in November 2016 by King Salman bin Abdulaziz Al Saud in Ras Al Khair, near Jubail in the Eastern Province of Saudi Arabia.

The complex is a commercial maritime project that complements the growth of the Saudi energy industry and helps to meet the development and diversification objectives outlined by Saudi Vision 2030.

The facility will offer quality, efficiency and economies of scale, and when completed will offer vessel and rig build, maintenance, repair and overhaul services. The project will comply with all of the Saudi government’s environmental and sustainability requirements, the statement added.

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