Saipem strengthens in the Middle East. The company has in fact announced that it has been awarded two offshore projects in Saudi Arabia under the Long-Term Agreement (LTA) in force with Saudi Aramco. The total amount of the two projects is approximately 500 million dollars and the title celebrates in MY BAG marking one of the best performances of the Ftse Mib with an increase of 1,83% to 2,397 euros per share. Since the beginning of the year, the stock has gained over 60% of its value.
Saipem: the two projects
In the context of first project, Saipem will undertake the engineering, procurement, construction and installation (EPCI) of a crude oil trunkline of approximately 50 km with a diameter of 42′ for the oil field. Abu Safa, while the activities related to second project concern the programs to maintain the production of the deposits Berri and Manifa. “The awarding of these projects further consolidates Saipem's positioning in the Middle East,” underlines the company led by Alessandro Puliti in a note.
Azerbaijan is also new
The announcement of the two projects in Saudi Arabia follows closely that of Friday 12 July, when Saipem announced that it had signed a three-year agreement (with the possibility of extension for a further 2 years) with BP for offshore activities in Azerbaijan $ 250 million.
According to analysts of Equity “the news improves the visibility of order collection estimates for 2024”. In particular, according to the brokers, the two contracts (Aramco and BP) represent 10% of the estimated order collection for 2024 for the offshore E&C (Asset Based Services division) or 6% of the overall group collection.
“We estimate that the ABS division has reached 6,4 billion in order collection since the beginning of the year, compared to the 7 billion estimated in 2024”. On the other hand, the EC and DO divisions appear "less" in terms of order collection. Given the type of activity, "we estimate that the Aramco projects awarded may have a margin lower than the average of the Abs division (HSD range up to 10% compared to the average of around 11%), while that of BP should be reasonably higher to the average."
