International Maritime Industries, a new shipbuilding joint venture between Saudi Aramco, Bahri, Lamprell and Hyundai Heavy Industries (HHI), has awarded a contract to Lamprell for the construction of two jackup drilling rigs, after it received a letter of intent for the contract in December 2018.
The two rigs were subcontracted to Lamprell after IMI secured the original contract from ARO Drilling, a 50/50 joint venture between Saudi Aramco and Valaris.
The two rigs will be built collaboratively between IMI and Lamprell, and it is expected that the vast majority of the work will be performed at Lamprell’s UAE facilities with final commissioning works performed in Saudi Arabia.
The first rig is expected to be completed in two years with the second rig being delivered three months later.
According to Lamprell, the gross margin contribution of the contract will be minimal. However, it will be utilising the jacking kits for the project which have already been paid for and are currently held in inventory, which is expected to result in the conversion of approximately $70m of inventory into cash over the project’s execution.
“We are delighted to have secured the formal award for the first two jackup rigs as part of our partnership with IMI and expect to host a substantial number of Saudi nationals during the course of the project in our facilities as part of building IMI’s capabilities. The maritime yard in Saudi Arabia is a significant part of the country’s economic ambition and we are honoured to play a role in its realisation,” said Christopher McDonald, CEO of Lamprell.
IMI, located in The King Salman Complex for International Maritime Industries & Services at Ras Al-Khair, Saudi Arabia, will be the largest full service maritime facility in the MENA region. It is scheduled to open in 2020 and be fully operational by 2022.