Arabian Drilling reports record orders backlog on high demand

Arabian Drilling, which provides drilling rigs for onshore and offshore oil and natural gas projects in Saudi Arabia and the Neutral Zone shared with Kuwait, reported a record high orders backlog of Riyals 12.7 billion ($3.39 billion) as of Sept. 30.

The average remaining contract tenure for the 47 active rigs is 25 years per rig, the company said in a Nov. 5 statement to the Saudi stock exchange. The backlog includes 10 new unconventional rigs ordered by Saudi Aramco, along with Aramco contract extensions such as a 10-year extension for an already operational offshore rig. Three offshore rigs with 5-year contracts started in July, it said.

"We are now focusing on delivering the new 10-rig unconventional package over the next few quarters," CEO Ghassan Mirdad said in the statement.

Arabian Drilling is expanding to service the backlog and new clients, with onshore rig demand headed for growth supported by the development of the Jafurah unconventional gas field, the company has said. Other customers include Baker Hughes, Al-Khafji Joint Operations in the Neutral Zone shared by Saudi Arabia and Kuwait and SLB, formerly known as Schlumberger.

Revenue in the third quarter was Riyals 920 million, up 16% on the year. It said prices have also climbed, notably in the offshore segment, but was not more specific. In March, the company said the average day rate in 2022 for land rigs was in the mid-$30,000 range and for offshore rigs it was in the high $90,000 range.