Latest news with #GhassanMirdad
Zawya
12 hours ago
- Business
- Zawya
Arabian Drilling fuels global expansion with first international offshore deal, UAE branch
Riyadh – Arabian Drilling has signed an agreement with a GCC-based company, marking its first offshore operation outside Saudi Arabia, according to a press release. The Saudi firm aims to expand its operations beyond its domestic market with a landmark geographical venture in line with its long-term strategy. Meanwhile, the operations are set to begin in the first quarter (Q1) of 2026 and will have an accretive impact on the backlog of SAR 75 million. The initial allocation of SAR 75 million is designated for the preliminary drilling of exploration wells within a period of five to seven months. This venture is expected to meet the challenges and capture the opportunities of the global market. Ghassan Mirdad, CEO of Arabian Drilling, commented: "Signing this contract signifies a strategic milestone for Arabian Drilling as it marks our first major step in expanding our operational footprint internationally.' "As we witness the unfolding events of this year, we are preparing to take significant steps to implement a major transformation with the aim of becoming a stronger and more flexible company, with a sustainable financial structure, and we look forward to facing the future with confidence, aiming to achieve long-term sustainable returns for our shareholders," Mirdad added. Meanwhile, Arabian Drilling launched a new branch in Sharjah to serve as a base for its regional operations within the GCC region and beyond. The UAE office is part of the company's strategic initiative to enhance its operational reach and service delivery in international markets. In February, the company inked a deal with Shelf Drilling Limited to deploy some of its premium jack-up rigs internationally. All Rights Reserved - Mubasher Info © 2005 - 2025 Provided by SyndiGate Media Inc. (
Zawya
03-07-2025
- Business
- Zawya
Arabian Drilling unveils 4-rig contract extensions with Aramco
Riyadh: Arabian Drilling secured contract extensions for four of its rigs with Saudi Aramco, with a combined backlog value of SAR 1.37 billion and durations ranging between one to 10 years. This milestone boosts the company's current backlog to SAR 11.10 billion, according to a press release. In line with its commitment to delivering exceptional service quality, Arabian Drilling is expected to realize the financial impact of extensions starting the third quarter (Q3) of 2025. Ghassan Mirdad, CEO of Arabian Drilling, commented: "Securing these contract extensions enhances our financial stability and reinforces our strategic position within the industry as we advance towards achieving sustained growth and realizing long-term success in a competitive market.' In November 2024, the two companies inked an extension deal for land rigs at a value of SAR 290 million.
Argaam
19-03-2025
- Business
- Argaam
Arabian Drilling's net income drop unrelated to revenue: CEO
Arabian Drilling Co.'s (ADC) net income decline in 2024 was not due to revenue generation challenges, but was primarily driven by costs associated with operating 13 new onshore drilling rigs for unconventional gas extraction, CEO Ghassan Mirdad told Argaam. In addition, non-cash items, including depreciation, asset impairment, and debt servicing costs related to capital expenditures contributed to the earnings decline. Mirdad explained that the company invested approximately SAR 1.9 billion in capital expenditures last year, with the majority allocated to developing unconventional rigs. In Q4 2024, the company successfully deployed three conventional drilling rigs and 11 of the 13 unconventional rigs last year. The operation of these rigs generated SAR 230 million in revenue, underscoring the positive financial impact of these investments. Mirdad noted that all 13 unconventional rigs are now fully operational and are expected to generate up to SAR 800 million in annual revenue. By the end of 2024, ADC had 49 active rigs out of a total fleet of 59, making it the largest drilling contractor in Saudi Arabia by fleet size. In his 2025 forecast, Mirdad confirmed that while the company does not anticipate an increase in its total rig count, it may reallocate rigs between the oil and gas sectors to enhance operational efficiency and better align with market and customer needs. He emphasized that this strategic approach enables ADC to adapt to demand fluctuations and maintain a high level of operational flexibility. On rig distribution, Mirdad highlighted that most of ADC's rigs are dedicated to gas extraction, reflecting the company's commitment to strengthening this sector in Saudi Arabia. He also underscored ADC's competitive advantage, particularly in light of national initiatives aimed at increasing gas usage in power generation. Saudi Arabia is targeting a 60% share of gas in its electricity generation mix. ADC plays a key role in the Jafurah field, the largest shale gas field outside the US, which presents a major strategic opportunity for the company. The firm aims to extract gas with high efficiency leveraging its expertise and advanced onshore drilling technologies. Mirdad further stated that ADC is well-equipped to address the technical and environmental challenges of shale gas drilling, reinforcing its leadership position in the energy sector. Regarding ADC's decision to provide future outlooks on a quarterly rather than annual basis, Mirdad explained that this shift was driven by the difficulty of forecasting various factors that could impact operations — positively or negatively — amid rapidly evolving geopolitical and economic conditions. He said providing quarterly forecasts allows for more precise market assessments and ensures a fairer evaluation of the company's performance. For Q1 2025, ADC expects to maintain the revenue at Q4 2024 level, with the potential for a 5% increase. In 2025, ADC's primary focus will be maximizing its fleet utilization. To support this objective, the company signed a memorandum of understanding (MoU) with Shelf Drilling Co. to expand its international offshore operations. 'We have already participated in several tenders as part of this alliance and are now awaiting the results, which are expected to be announced in nearly three months,' Mirdad stated.
Zawya
12-03-2025
- Business
- Zawya
Arabian Drilling announces resilient FY 2024 financial performance
FY 2024 revenue increased by 4.1%, reaching SAR 3,619 million in line with guidance Strong EBITDA margin of 41.7% maintained Successful deployment of 13 new unconventional land rigs Increased total rig count to 59, reinforcing market leadership AlKhobar, Kingdom of Saudi Arabia – Arabian Drilling, or the 'Company', (Tadawul symbol: 2381), Saudi Arabia's largest onshore and offshore drilling contractor by fleet size, announced today its financial results for the fourth quarter of 2024 ('Q4 2024') and the full year ended 31 December 2024 ('FY 2024'), highlighting growth in annual revenue and a robust EBITDA margin. FY 2024 Revenue recorded SAR 3,619 million, marking a 4.1% year-on-year increase and EBITDA reached SAR 1,508 million with a strong EBITDA margin of 41.7%. Cashflow from operating activities balance recoding SAR 1,750, 28.6% higher than FY 2023. Arabian Drilling ended the year 2024, with a healthy backlog of SAR 10.3 billion with an addition of SAR 795 million in Q4 2024. Backlog growth was driven by contract extensions for two land rigs and one offshore barge, adding 17 active rig years. Arabian Drilling successfully deployed 13 new unconventional land rigs in Saudi Arabia, bringing its land fleet size to 47 rigs and the total fleet to 59 rigs by the end of 2024 reflecting an increase of 20.4% year on year and 31.1% since its listing in Tadawul in November 2022. This focused strategic expansion reinforces the Company's position as the leading drilling company in Saudi Arabia by fleet size, and positions Arabian Drilling's as a national leader in the Kingdom. The newly deployed unconventional land rigs were swiftly constructed and mobilized to support Saudi Arabia's dynamic energy needs as it advances to increase the share of natural gas in the energy mix. A key enabler of this shift is the Jafurah gas field, the largest unconventional gas development in the region. In a post-period event on 17 February 2025, the Company announced signing a Memorandum of Understanding with Shelf Drilling, a leading international shallow water offshore contractor with rig operations across the Middle East, Southeast Asia, India, West Africa, the Mediterranean and the North Sea. This strategic alliance aims to enhance Arabian Drilling's ability to expand its offshore drilling operations globally, facilitating the international deployment, through of premium jack-up rigs utilizing Shelf Drilling's extensive global footprint. The Alliance allows the Company to leverage Shelf Drilling's diverse network of international customers, expanding the reach and capabilities of both companies. Ghassan Mirdad, Chief Executive Officer of Arabian Drilling, commented on FY 2024 results: "We have demonstrated strong and resilient performance in FY 2024, successfully delivering on revenue guidance with a 4.1% increase to reach SAR 3,619 million and an EBITDA of SAR 1,508 which marks a 41.7% margin. Our competitiveness is underscored by the successful penetration of the unconventional gas market with 13 new rigs, which have significantly expanded our ability to drive sustainable future growth of the company. Now that we are witnessing an influx of drilling tenders internationally, the alliance with Shelf Drilling comes at an opportune time as we are currently marketing 3 available rigs with the alliance. This partnership will provide us with a license to operate globally to expand our presence in international regions with high demand for offshore rigs. Hubert Lafeuille, Chief Financial Officer of Arabian Drilling, commented: "We are delighted to report that we have achieved revenue growth for the fiscal year despite the challenges faced in 2024. Our EBITDA remains strong, reflecting solid profitability and operational efficiency. We have made notable improvements in our financial position, demonstrated by improved net working capital and a robust debt profile. Furthermore, our ability to maintain a healthy backlog of SAR 10.3 billion was supported by our ability to secure strategic contract extensions. This highlights our adaptability and strategic foresight in a Saudi Arabia's dynamic market. Our strong balance sheet enables us to pursue geographical expansion, enhancing our ability to swiftly reposition ourselves to capture targeted growth opportunities that require our expertise. " While Arabian Drilling generated a strong EBITDA in 2024, higher net financing expenses and increased depreciation costs that comes expanding in the unconventional market in the Kingdom, impacted the year's adjusted net income, which, after accounting for a one-time non-cash impairment charge of SAR 105 million recognized in Q2, declined by 29.5% year-on-year to SAR 426 million. This decline includes the impact of interest charges on loans, as well as the impact of capitalized interest in 2023. The increase in depreciation and amortization expenses is primarily attributed to the expanded asset base. This includes the addition of three offshore rigs in the latter half of 2023 and thirteen unconventional land rigs in 2024. Rig Contract Renewal Arabian Drilling has a total of 24 rigs, which include 21 land rigs and 3 offshore rigs, with contracts set to expire in 2025. Out of the 21 land rigs, 11 are contracted with SLB for the gas Lumpsum Turnkey (LSTK) project and include a one-year extension option. Considering the significance of gas drilling in supporting Saudi Arabia's transition towards increased usage of gas for electricity generation, it is anticipated that the extension option for all 11 rigs will be exercised. Seven land rigs, primarily gas, are directly contracted with Aramco and are currently under negotiation for renewal. The remaining rigs are bearing extension options, or under negotiation for renewal. For offshore operations, three rigs nearing contract completion, one of which is currently suspended, while one rig is contracted with KJO and is undergoing contract renewal negotiations. The final rig, which is leased, is currently contracted with Aramco and has a one-year extension option as well as a corresponding lease extension option. This arrangement grants flexibility to extend or terminate the lease based on the contract renewal status. Strategic Priorities for 2025 For FY 2025, Arabian Drilling outlines its strategic priorities to drive growth and deliver on its core mission and values. Increase fleet utilization – both in the land and offshore segments, locally and internationally. Supporting KSA's Energy Transition – Arabian Drilling will continue to support Saudi Arabia's energy transition plans by providing advanced gas drilling solutions, mainly in the unconventional gas drilling sector. Global Expansion – With the alliance with Shelf Drilling in place, the Company aims to expand its operations to lucrative international regions with high demand for drilling services at minimal cost. Health, Safety, and Environment (HSE) – the Company continues to significantly enhance Health, Safety, and Environment activities, ensuring the highest standards are upheld while prioritizing employee welfare through comprehensive safety programs and ongoing training. Short-term Guidance In light of the prevailing uncertainty in the oil and gas sector, coupled with current geopolitical and economic factors that may impact operations, management has opted to provide quarterly guidance, rather than on an annual basis. This approach allows the Company to provide more realistic guidance to the market, supporting fair market valuation. For the next quarter, the Company expects its financial performance to continue to reflect the resilience and operational efficiency demonstrated in 2024. For Q1 2025 revenue, we expect to maintain the same level compared to Q4 2024 with a 5% upside. Our guidance reflects a cautious outlook in an unpredictable, but evolving market environment. Dividends The Company's Board has approved a dividend of SAR 1.35 per share for H2'24, to be paid in April 2025, bringing the total dividend for FY'24 to SAR 240.3 million. The Company will continue to assess dividends payments on a semi-annual basis, aiming to maintain a balance between supporting investments for sustainable long-term growth and returning value to shareholders.
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.
