Arabian Drilling renews 11 SLB gas rig contracts for 1 year

Arabian Drilling Co. (ADC) extended the contracts for 11 onshore gas drilling rigs with SLB for one year.

In a statement to Tadawul, the company said the extension represents 15%-20% of its 2024 revenues.

All 11 rigs are currently in operation, and ADC will continue providing drilling services to SLB under a lump sum turnkey (LSTK) contract in Saudi Arabia.

The company added that the financial impact of the extension will reflect in revenues starting from the current quarter.

ADC also noted that SLB is a related party, holding a 34.3% stake in the company.

The company noted that an LSTK contract is a comprehensive agreement commonly used in construction and engineering projects.

Under this type of contract, the contractor agrees to complete the project for a pre-agreed fixed price, taking responsibility for both design and execution to meet specified requirements and ensuring the project is fully operational upon completion.

The company’s revenues reached about SAR 3.61 billion in 2024, and 15% to 20% of it amounts to SAR 542.4 million to SAR 723.8 million, data compiled by Argaam showed.