ADES renews suspended jackup deal for 10 years

Saudi oil and gas driller ADES has successfully renewed a significant contract for one of its offshore jackup rigs that was previously suspended by Saudi Aramco. This renewal, which spans a firm duration of ten years, is projected to generate approximately $290 million, enhancing the company’s long-term revenue prospects and backlog sustainability.

Details of the Contract and Rig Operations

The specific rig involved in this renewal has not been disclosed, but it is currently engaged in a medium-term contract in Egypt. ADES operates seven jackup rigs in the Egyptian market, including the Admarine VIII, Admarine V, Admarine IV, Admarine III, Admarine VI, Admarine 88, and Admarine 260. Upon completion of its current contract, one of these rigs will return to Saudi Arabia to fulfill the renewed agreement.

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Last year, ADES had mutually agreed with Saudi Aramco to temporarily suspend operations on six of its 33 offshore jackup rigs in the Kingdom for a period of up to 12 months. Although the company did not initially disclose the customer for the renewed contract, it has been confirmed that it is indeed Saudi Aramco, with whom ADES currently has 30 rigs on hire.

Mohamed Farouk, CEO of ADES, expressed satisfaction with the renewal, stating, “We are very pleased to have secured this renewal for our unit in Saudi Arabia, particularly as it was among the six previously suspended rigs in the Kingdom. The new award validates the Group’s optimism regarding the outlook of our business in the Kingdom.” He further emphasized the company’s commitment to pursuing additional renewals and expanding its backlog in key markets to enhance long-term revenue visibility, especially amid the current tightness in the global offshore jack-up market.