Opportunity Arabia 2014: Joep Straathof
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Doing Business with Saudi Aramco
Opportunity Arabia 11
Edinburgh, United Kingdom
Joep Straathof
October 9, 2014
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Presentation Outline• Saudi Aramco
> Introduction
> Focus areas
> Business opportunities
> Partnering
• How to proceed with Aramco Overseas Company
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Saudi Aramco IntroductionFully integrated energy enterprise
260.2billion
barrels oil reserves
1 in 8 barrels of the world’s
total crude oil production
4.9million
bpd global refining capacity
288.4trillion
scf gas reserves
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A history of transformation
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We believe energy has the power to transform
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Focus areas
Upstream Leadership
Downstream Growth
Innovation
Energy Sector Development
Citizenship
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Value chain integration
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Continued focus on upstream leadership
121 Oil & gas field discoveries to date
1 billionCell resolution for reservoir simulation
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A new driver of value creation
Benefits of unconventional gas:
4. Optimize Kingdom’s energy mix
3. Reinforce Saudi Aramco’s position as a reliable global supplier ofenergy
2. Re-allocate crude for higher valueapplications
1. Supplement the Kingdom’s gas supply
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A global, integrated refining business
1.0Millions of
barrels per day
Domestic wholly-owned refineries:Ras Tanura - 550k bpdRiyadh - 120k bpdJidda - 90k bpdYanbu - 240k bpd
International joint venture refineries:Motiva - 1,070k bpd S-Oil - 669k bpd Fujian - 240k bpd Showa Shell - 395k bpd Sekiyu K.K.
2.4Millions of
barrels per day
Domestic joint venture refineries:Petro Rabigh - 400k bpdSAMREF - 400k bpdSASREF - 305k bpdSATORP - 400k bpd
1.5Millions of
barrels per day
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A global, integrated refining business
Ras TanuraRefinery
JubailRefinery
Jiddah Refinery
YanbuRefinery
Petro Rabigh JV with Sumitomo
Chemicals
SAMREFJV with Mobil Yanbu Refining Company
SASREFJV with Shell Saudi Arabia Refining Ltd
SATORPJV with Total
MotivaJV with Shell
S-OilEquity Venture in Korea
FujianJV with FREP
Showa Shell Skiyu K.K.
JV with Shell
Texas, USA South Korea China Japan
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Our competitive edge in a rapidly changing world
Innovation in:
SafetyChemicals
CatalysisOil Upgrading
SeismicProcessing
ReservoirSimulation
DesulfurizationCarbon Management
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A global, competitive Saudi energy services sector
Enable industrial clusters
Support local manufacturing
Encourage investment
Prepare local workforce
Facilitate entrepreneurship
Foster localization
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14
EnvironmentKnowledgeEconomy Community
Citizenship
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Projects
CURRENT FUTURE
YASREFJV with Sinopec
JazanJazan refinery and terminal project
SadaraJV with DOW Chemical Co.
ShaybahNGL recovery plant
KhuraisKhurais central processing facility
WasitWasit Gas Plant
MidyanNGL Recovery Plant
Petro RabighJV with Sumitomo Chemical
SAMREFJV with ExxonMobil
Yunnan ProvinceJV with PetroChina
FadhiliFadhili Gas Plant Program
Ras Al KhairJV with SembCorp and Bahri
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Material Spend including Localization
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
Pipes andstructural steel
Columns,vessels,
exchangersand valves
Compressors,pumps and
turbines
Instruments,electrical andtransmitters
Chemicals,drilling fluidsand inhibitors
Drilling andproducingequipment
Health, safety,security and
fire equipment
Constructionand general
supplies
Ca
pit
al B
ud
ge
t ($
Bln
.)
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Supplier Preference
In-Kingdom Manufactured
Goods
Imported Goods
Warehoused by
Local Stockists
Goods Imported by
Local Vendors
Imports through
Out-of-Kingdom
offices
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Material Spend including Localization
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
Pipes andstructural steel
Columns,vessels,
exchangersand valves
Compressors,pumps and
turbines
Instruments,electrical andtransmitters
Chemicals,drilling fluidsand inhibitors
Drilling andproducingequipment
Health, safety,security and
fire equipment
Constructionand general
supplies
Lo
ca
liza
tio
n
Cap
ital B
ud
get
($ B
ln.)
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Localization of Business
• Strategic directive for 2020 is 70%
• Targets defined per category
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Original Equipment
Manufacturer
Local Supply Chain Development
SalesStockist
Assembly
Production
Repair Shop
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Equipment Manufacturing Opportunities
Pipes and steel structure
> Nonmetallic piping
Machinery equipment
> Compressors
> Industrial belts and pulleys
> Pumps
> Turbines
Chemicals
> Catalysts
> Drilling mud additives and well stimulants
> Lubricating greases
> Specialty chemicals (drilling and others)
Static equipment
> Air and oil filters
> Bearings
> Boilers, heat exchangers and chillers
> Hoses
> Pipe fittings and wrap
> Sealing products (mechanical)
Instrumentation, electrical and IT
> Batteries, rectifiers and power supplies
> Bushings and insulators
> Calibration
> Circuit breakers and Programmable Logic Controllers
(PLCs)
> Electrical fittings (connectors, terminal blocks)
> Enclosures and frames
> Indication lights, switches and electric meters
> Instrument and fiber optic cables
> Instrumentation (EDS, DCS, flow meters, pressure
transmitters, etc.)
> Junction boxes
> Level indicators
> Packers and wire line accessories
> Sealing compounds (electrical)
> Thermo couples and RTDs
Drilling
> Drill bits
> Oil Country Tubular Goods (OCTG) casing, tubing and
accessories
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Services Opportunities
Carbonate Reservoir Product Development
> Automation and controls
> Enhanced recovery innovation
> Reservoir modeling and simulation
> Reservoir stimulation
> Seismic and surveying
> Well logging innovation
Well Intervention Design
> Complex well logging
> EHS services
> Enhanced recovery
> Mud logging
> Pressure pumping
> Well stimulation
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Incentives Supporting Local Manufacturing
Local manufacturing premium up to 10%
Exclusive bidding for local manufacturers
Long term agreements (5-10 years) within the context of Category
Based Strategies
10%
Local
5-10 years
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Saudization
• Employment of Saudi nationals
• National policy of the Kingdom
• Targets defined by company size
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New Business Development
Investors’ Gateway to Saudi Aramco
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New Business Partner Process
• Historical consumption figures for feasibility study
• Technical and quality requirements (international and Saudi Aramco standards)
• Guidance in investment process
Once approved, Saudi Aramco will be ready to begin the procurement process, if
prices are competitive and delivery terms are acceptable
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Why Partner with Saudi Aramco
• Business opportunities
• Wide network
• Knowledge and expertise
• Alignment with material/service requirements
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Aramco Overseas Co. Introduction
• Subsidiary of Saudi Aramco
• Provider of supply chain, technology and human resources services
• Aramco Overseas Co. (AOC) headquarters located in the Netherlands
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AOC’s Supply Chain Offerings
Sourcing & Supplier
Relations
Engineering
Purchasing Quality
Management
Expediting
Logistics
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AOC Contact Details
• Aramco Overseas Company
www.aramcooverseas.com
• Joep Straathof
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شكرا
Thank you