Riyadh, Saudi Arabia: ADES Holding Co., a leading Saudi exploration service provider, has secured six onshore drilling contracts with Kuwait Oil Co. worth SR2.42 billion ($645.3 million), marking a significant expansion of its operations in the region.
According to a release to Tadawul, the new agreements include contracts for four existing rigs operating in Kuwait and two newly constructed units. These contracts are scheduled to commence in the second and third quarters of 2025, with a firm five-year duration and an optional one-year extension.
Mohamed Farouk, CEO of ADES Holding, commented, “Securing such long-term contracts not only adds to the sustainability of our backlog and visibility of our business but is also a testament to ADES’ exceptional safety and operational performance, which will see us triple the size of our contracted fleet in Kuwait from four to 12 rigs upon deployment in 2025.”
Farouk further noted, “With these new awards, ADES has further solidified its position in the niche Kuwaiti onshore market, characterized by high barriers to entry and deep drilling deployments where ADES has consistently proven its abilities.”
The contracts involve deep drilling rigs in the 3,000-horsepower category, a growing market segment in Kuwait. The estimated backlog for these contracts stands at SR2.42 billion, encompassing both the firm and optional periods.
In just 24 months, ADES has seen a remarkable three-fold increase in its contracted fleet with Kuwait Oil Co., rising from four rigs in early 2023 to an anticipated 12 rigs by 2025. Currently, ADES operates 10 onshore rigs with KOC, underscoring the company’s strengthened presence and strategic alignment with Kuwait’s energy sector objectives.
In addition to its expansion in Kuwait, ADES has been broadening its regional footprint. In May, the company sealed two contracts worth SR511 million, highlighting its growing influence in the oil and gas sector. Notably, ADES signed a deal with TotalEnergies to operate an offshore drilling platform in Qatar valued at up to SR350 million, with operations set to begin in the second half of 2024.
Furthermore, ADES announced a 21-month contract to employ an elevated platform in the Gulf of Suez. The company received a direct award letter from the Suez Oil Co. (SUCO) in Egypt, with operations expected to commence soon. This deal is valued at SR161 million.
This new engagement in Egypt is part of ADES’s broader regional strategy to reactivate its operations, following recent contracts in Thailand and Qatar. These contracts bring the total number of reactivated platforms to three out of the five that were recently suspended in Saudi Arabia.