Vallourec and Aramco expanded their industrial collaboration through a new agreement for the supply of OCTG tubular products destined for oil operations.
The agreement, formalized during the recent Franco-Saudi Investment Roundtable held in Paris, seeks to reinforce commercial, industrial, and technological ties between both companies. The new stage builds on a relationship that began in 1962 and has since gained weight within Saudi Arabia.
For Vallourec, the agreement also consolidates an industrial presence developed over decades around premium tubular solutions for oil and gas. The French company supplies technologies designed for wells operating under demanding conditions and maintains local production capacity to serve the Saudi market.
A collaboration between Vallourec and Aramco initiated in 1962
Specifically, the commercial relationship began nearly 65 years ago with an agreement to supply the first generations of VAM connections designed for Oil Country Tubular Goods (OCTG).
These tubular solutions form part of the equipment used in oil and gas drilling and production operations. From that first cooperation, Vallourec gradually increased its industrial activities within the Kingdom.
Subsequently, 2011 marked a new stage with the creation of Vallourec Saudi Arabia and the opening of an industrial facility in Dammam. This plant enabled local execution of processes such as heat treatment of tubulars and threading of premium VAM connections.
Thus, the relationship shifted from a scheme centered primarily on supply to one with greater participation of industrial capacity installed in Saudi Arabia.
Local production of OCTG tubulars for Aramco
Later, in 2022, Vallourec and Aramco signed a long-term agreement for the supply of premium OCTG tubulars manufactured locally. That agreement reinforced the role of Saudi production within the relationship between both companies.
Additionally, Vallourec continued expanding its capabilities through research and development projects and initiatives aimed at increasing local manufacturing. These investments are oriented toward supplying products required by new energy developments in Saudi Arabia, including projects associated with unconventional resources.
In 2023, the company also received recognition within the Aramco Local Manufacturers Quality Excellence Awards in the “Best Improved Quality Performance” category.
The new agreement now deepens that strategy by maintaining OCTG supply as one of the pillars of the industrial relationship between the companies.
Vallourec reinforces its industrial capacity in Saudi Arabia
On the other hand, the expansion of local production capabilities takes on relevance for the Saudi oil supply chain. Having heat treatment, threading, and manufacturing processes within the country reduces dependence on certain operations performed outside the Kingdom and brings production closer to the end customer.
Philippe Guillemot, Chairman of the Board and Chief Executive Officer of Vallourec, noted that the new agreement reflects the trust developed with Aramco since 1962.
This agreement is testimony to the solid relationship that Vallourec has built with Aramco since 1962.
Guillemot stated.
The executive also highlighted Vallourec’s local industrial presence and its role in serving Aramco and supporting supply security in Saudi Arabia amid current logistical constraints.
Likewise, the continuity of investments in R&D and production capacity aims to accompany future oil and gas projects in the country. The agreement once again places OCTG tubulars, premium VAM connections, and local manufacturing at the center of an industrial relationship approaching seven decades.
Source and photo: Vallourec
