| MANAMA, March 8
MANAMA, March 8 U.S. oilfield services and
equipment provider McDermott International said on
Wednesday it would build a fabrication yard at a shipbuilding
complex planned by national oil giant Saudi Aramco IPO-ARMO.SE
on the kingdom's east coast.
The two companies signed a memorandum of understanding for
the first major manufacturing investment in the complex, which
is part of Saudi Arabia's drive to diversify its economy and
create jobs in an era of cheap oil.
Saudi officials have said the complex at Ras Al Khair will
cost more than $5 billion to build. The kingdom wants to
jump-start local manufacturing industries by making more
equipment for its oil industry at home rather than importing it.
McDermott plans to build and outfit offshore oil and gas
platforms at the new yard. A source familiar with the deal said
the companies aimed to sign a final agreement by next year, with
Aramco providing land for the project by the end of 2019.
The development of Ras Al Khair could eventually take
business away from other maritime yards in the region, such as
Dubai's Jebel Ali. McDermott said it expected to move business
gradually from Jebel Ali to Ras Al Khair by the mid-2020s.
The U.S. firm did not give a monetary value for its planned
investment in Ras Al Khair but said its facility there would
have up to 16 million man-hours of capacity, compared to 8
million man-hours at its current Jebel Ali facilities.
Last year, Saudi Aramco signed a memorandum of understanding
for construction of the complex with National Shipping Co of
Saudi Arabia, a state-controlled firm which ships oil
for Aramco, as well as a subsidiary of London-listed Lamprell
, a United Arab Emirates-based engineering firm, and
South Korea's Hyundai Heavy Industries.
(Writing by Andrew Torchia; Editing by Edmund Blair)