Becoming partners with Saudi Aramco
Posted: 13 June 2005
EPC companies from across Europe and Asia joined a team from Netherlands-based Aramco Overseas Co. B.V. (AOC), Saudi Aramco and the Saudi Arabian Embassy, hoping to become new business partners with Saudi Aramco.
The focus of the symposium was to develop new Eurasian EPC sources to meet the company's capital project needs, and also to promote an in-Kingdom presence of service and materials providers. EPC attendees learned not only the steps required to become business partners with Saudi Aramco, but also the mutual benefits of an in-Kingdom presence.
Waleed A. Elkhereiji, Saudi ambassador to the Netherlands , provided an overview of the favorable political, social and economic climate, and competitive business advantages of the Kingdom. Addressing investment opportunities, he stressed that there is strong in-Kingdom consumer confidence, partly promoted through the return of budget surpluses from oil revenues, which have freed bank liquidity for funding private investment.
 "As custodian of a quarter of the earth's proven oil reserves," he added, "the Kingdom understands that our responsibility reaches far outside of the Kingdom and deep into the international business community. Therefore, the revenues we have generated during the recent global energy demand peak have been invested not only in a better future domestically for the Kingdom, but also in a better future for the global economy and the international business community."
Abdalhafidh Nagshabandi, AOC's managing director and event host, cited growing global energy demand, reliable, stable and competitively priced energy and feedstock, and governmental investment infrastructure support as key factors in promoting a sustainable business partnership.
After detailing the sectors and then the specific business opportunities within the Saudi Aramco operation, Nagshabandi provided examples of successful Eurasian-Saudi business partnerships and encouraged the EPCs to fully explore the opportunities for doing business with Saudi Aramco.
In order to give the EPCs a thorough understanding of the challenges and opportunities in store over the next five years in meeting world demand for energy, Ahmad S. Nasser, Saudi Aramco's senior project manager, said Saudi Arabia has 130 projects greater than $200 million each, out of the total $421 billion in projects in the Gulf region. Those projects will require 58.5 million hours of engineering and 1.36 billion construction hours.
European EPCs hold about 300 active contracts totaling $6.2 billion, held by 189 companies. Over the course of his presentation, Richard J. Arnold, a Saudi Aramco Contracting Department specialist, explained the process by which major EPCs obtained those contracts.
Once prospective EPCs have met Saudi Aramco's requirements and successfully bid upon a contract, the operational side of service and materials supply comes into play.
In his presentation, AOC purchasing agent Gerard Woudenberg said Saudi Aramco's main areas of focus are quality, reliability and competitive cost, with the supplier providing the best possible product or service at the best possible price. To conclude, Woudenberg noted that on behalf of Saudi Aramco, AOC nurtures sustainable, long-term partnerships for the supply of innovative products.
Nagshabandi concluded that, "The response from the potential EPCs has been excellent. Of the 40 prospect companies, the team identified five new high-potential European EPCs, some from new European Union member countries, and at least two new European companies that we shall work closely with to explore potential business partnerships."
Posted by Editor Pipeline Magazine
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