This opportunity entails developing the value chain for the production of coiled tubing strings to serve the KSA and GCC oil and gas industry.
In 2016, KSA demand for Coiled Tubing strings is estimated to be 130 coil units (~USD 30 million), and forecasted to increase at an annual growth rate of ~5% to reach 207 coil units by 2022. Currently, KSA demand for Coiled Tubing strings is addressed fully through imports, presenting a great opportunity for investors to localize production.
Beyond the KSA market, investors in Saudi have the opportunity to tap into the large regional market in the GCC which is expected to witness strong growth fueled by oil and gas production, expected to increase from 174 units (~USD 63 million) in 2017 to 214 units by 2022.
In addition to the increasing demand for Coiled Tubing strings in the KSA and wider GCC region, the manufacturing process for Coiled Tubing strings is relatively simple and there exist local capabilities to support the manufacturing. Also, incentives for investors provide an advantage for procurement within Saudi, Saudi has cost advantages on labor, land and logistics, and there are various general funding and other government support incentives that investors can take advantage of.
The focus of this opportunity is on the consumable part of the value chain. However, beyond the manufacturing of Coiled Tubing string, other opportunities exist across the value chain including:
- Supplies and tools: stimulation fluids, corrosion inhibitors, packers
- Coiled Tubing service delivery providers in KSA are potential customers of Coiled Tubing string materials
–After-sales services such as NDE (non-destructive examination) and spooling can also be offered by SMEs to Coiled tubing strings consumers. Saudi Aramco requires coiled tubes be inspected using NDE techniques once every 6 months, and only tubes that pass testing can be used on Aramco wells
Industrial and Manufacturing
Industrial Equipment & Spare Parts
To be determined by the investor
To be assessed by investor (cost drivers and other financial figures to be shared upon request)
Open to starting the project as soon as possible
- Pure private sector model
- Joint venture with local player
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