US offshore drilling contractor Rowan Companies and Saudi Aramco have signed a deal to create a new offshore rig outfit.
The new organization will be a 50/50 joint venture (JV) which will own, operate, and manage offshore drilling rigs in Saudi Arabia, including newbuild units to be built in the country.
This will initially include three Rowan jackup rigs and two Saudi Aramco owned jackups, plus the management of five further Rowan jackups, until their current contracts expire.
Rowan will contribute a further two jackups, when they complete their current contracts, due to end late 2018, for Saudi Aramco.
Rowan and Saudi Aramco have committed the new company to purchase future newbuild rigs that will be constructed in Saudi Arabia.
The new JV will use Rowan's established business in Saudi Arabia as its base. Operations are expected to start in Q2 2017.
Tom Burke, President and Chief Executive Officer, said: "The new company will uniquely position Rowan to participate in the growing Saudi Arabian offshore drilling market, and provide Rowan with a compelling opportunity for a long-term partnership with the world's leading oil and gas company, and create a long-term, profitable growth platform with firm rig commitments."
Rowan has 30 mobile offshore drilling units, comprised of 26 jackup rigs and four ultra-deepwater drillships.