Saudi Aramco (TADAWUL: 2222) and Baker Hughes (NYSE: BKR) have announced the formation of a new company called Novel Non-Metallic Solutions Manufacturing (Novel).
The business is described as a 50/50 joint venture (JV) to develop and commercialize a broad range of non-metallic products for multiple applications in the energy sector. A ceremony was held on Tuesday marking the commencement of construction of Novel’s new facility. The ceremony comes after both companies signed a memorandum of understanding to create a non-metallics JV back in July last year.
Novel’s site is being developed at King Salman Energy Park (SPARK), in Saudi Arabia’s Eastern Province. SPARK is a 19 square mile energy city megaproject which will position Saudi Arabia as a global energy, industrial and technology hub, according to Aramco, which said the JV aligns with its strategy to seek new opportunities in oil-based products, which not only offer performance benefits but also aim to reduce carbon emissions.
“Non-metallic products are reshaping the industries and products we all depend on because they are more reliable, cost effective and offer sustainability benefits,” Aramco’s senior vice president for technical services, Ahmad Al Sa’adi, said in a company statement.
“The partnership with Baker Hughes reinforces our commitment to expanding the use of innovative non-metallic materials in our operations to drive efficiency and reduce maintenance and replacement costs, while also positively impacting the Kingdom’s economic development through job creation and local expertise,” he added.
Neil Saunders, the executive vice president of oilfield equipment at Baker Hughes, said, “as an energy technology company, we are investing for growth in strategic areas like non-metallics, and our deep background in non-metallic product development will benefit a wide range of industries”.
“Aramco’s vision to expand its product development in the region aligns with our vision to support innovation and manufacturing in Saudi Arabia,” he added.
In September 2019, Aramco opened the Non-metallic Innovation Center in the United Kingdom, in collaboration with the UK-based Welding Institute and the National Structural Integrity Research Centre, to conduct research and development of non-metallic technologies. The center collaborates with academic institutions and manufacturers to develop, test, and market new products.
Aramco describes itself as a leading producer of the energy and chemicals that drive global commerce. The company employs almost 80,000 people and manages the Kingdom’s proved reserves of 336.7 billion barrels of oil equivalent. Baker Hughes, which employs almost 60,000 people, is an energy technology company with operations in more than 120 countries.
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