Saudi Aramco signed a deal with National Oilwell Varco Inc. (NYSE: NOV) to form a joint venture (JV) to make onshore rigs and equipment in Saudi Arabia, the state-owned Saudi energy firm said.
Saudi Aramco will own 30% of the venture, while the rest will be owned by Houston-based NOV, the statement said.
Aramco President and CEO Amin Nasser said the deal was a step "towards the creation of a vibrant energy services sector."
Aramco, the world's biggest oil producing company which the Saudi government plans to list in the kingdom and abroad, has been seeking to expand its operations with new downstream and associated industry investments.
The new JV, which will be based in Ras Al-Khair, near the Jubail Industrial City on Saudi Arabia’s east coast, aims to produce 10 onshore rigs per year, Aramco said.
Commissioning of the facility is expected by 2020 with the first rig to be delivered in 2021, the company said.
Saudi Aramco reported a 12% fall in half-year net profit on Aug. 12, yet remained the world's most profitable company, while India's Reliance Industries said Aramco is looking to buy into its refining and petrochemicals business.
Wood Plc’s 2018 profit topped market expectations as the British oil field and engineering services provider trumpeted the success of its 2017 takeover of smaller rival Amec Foster Wheeler and increased revenue synergies from the deal.
Saudi Arabia has shelved a $200 billion plan with SoftBank Group Corp. to build the world’s biggest solar-power-generation project, the Wall Street journal reported on Sept. 30, citing Saudi government officials.