Arkad And ABB Form Joint Venture

Arkad Engineering & Construction Ltd. and ABB S.p.A. and have formed a joint venture to execute engineering, procurement, and construction (EPC) projects in the oil and gas industry. ABB’s current oil and gas EPC business will be transferred to the new company, Arkad-ABB SpA.

Headquartered in Milan, Italy, Arkad-ABB S.p.A. will provide a full range of integrated EPC services for oil and gas plants including project management, process engineering, multi-disciplinary detailed engineering, procurement, construction, commissioning, and start-up.

“The joint venture is in line with our strategy to continuously optimize our portfolio while increasing customer focus. Arkad’s core strengths and deep local roots perfectly complement the competencies of the oil & gas EPC unit, allowing it to reach its full potential for the benefit of customers,” said Peter Terwiesch, President of ABB’s Industrial Automation division. “While our oil and gas EPC business will be transferred to the new joint venture, ABB will continue to serve the oil, gas, and chemicals sector globally with its industry-leading automation, electrification, and digitalization solutions.”

Arkad, the largest locally-owned Saudi Arabian energy services company, will be the majority shareholder of Arkad-ABB SpA. The deal gives Arkad a stronger foothold in Algeria, Kuwait, and the United Arab Emirates. For ABB, the joint venture promises new opportunities in Saudi Arabia, where Arkad’s main customer is Saudi Aramco.

Arkad, based in the eastern Saudi city of Al Khobar, is currently building a gas pipeline system for Aramco that will span more than 685 miles (1100 km) from Saudi Arabia’s Eastern Province to Rabigh on the Red Sea. The network is part of the country’s Master Gas System phase two expansion.

Aramco built the original Master Gas System in the 1970s, with gas-gathering and processing facilities allowing Aramco to use or market nearly all the produced gas associated with oil production. In 2013, Aramco launched a two-phase initiative to expand gas gathering and processing capacity.

Phase one, completed in 2017, added two booster gas compressor stations in the Red Sea region, which help supply natural gas to the Saudi Electric Company Rabigh-2 power plant and the new King Abdullah Economic City. Phase two expansion of the Master Gas System is scheduled for completion in 2019.