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Saipem moves to maintain grip on Gulf offshore market

28 March 2025

Commentary
Indrajit Sen
Oil & gas editor

Saipem is by far the largest contractor in the Gulf’s offshore oil and gas industry. The Italian firm won five out of the eight offshore engineering, procurement, construction and installation (EPCI) jobs awarded by Saudi Aramco in 2024 and succeeded in Qatar with both phases of the multibillion-dollar North Field Production Sustainability (NFPS) programme.

Despite its accomplishments, Saipem realises the need to grow its business. In February, the Milanese company started a merger transaction with UK-based Subsea7 to create an offshore services giant that will dominate the Gulf and international projects market in the future.

Saipem’s concerns about its position in the regional market are not unfounded. In late March, India’s Larsen & Toubro (L&T) announced winning the largest contract in its history. The job, estimated to be worth $4bn-$5bn, is also part of the second phase of QatarEnergy LNG’s NFPS programme.

Abu Dhabi’s NMDC Energy, which has grown to become a regional giant in recent years, is also a major challenger to Saipem. The Abu Dhabi-listed firm is deeply entrenched in its home market, and competing with it for Abu Dhabi National Oil Company (Adnoc) offshore projects is no easy task for overseas contractors.

There are others, such as Lamprell and China Offshore Oil Engineering Company (COOEC). Since being acquired by its Saudi owners in 2022, Lamprell has grown its workforce and assets, resulting in key Aramco project wins.

COOEC, too, has been winning offshore work from Aramco, and is now seeking to grab a bigger share of the Saudi market. The Chinese firm recently signed an agreement with Aramco to potentially invest in a fabrication facility in the kingdom – a move that has, and continues to, pay dividends for its peers Saipem, Lamprell and NMDC Energy.

In Saudi Arabia, competition for every Aramco offshore EPCI job is fierce, and past performances count for little. By renewing Long-Term Agreements with some of the contractors earlier this year, Aramco has pushed the reset button and ensured a level playing field for all. 

The backdrop to this intense competition is a GCC offshore oil and gas industry that is going through a prolific era, heralded by a surge in capital expenditure on projects by regional operators since 2023.

With capital expenditure on GCC offshore projects in 2025 set to surpass last year’s record, competition for work is expected to remain vigorous – a situation project operators will be keen to maintain.

ALSO READ: Regional offshore oil and gas sees steady capex

MEED’s April 2025 report on Saudi Arabia includes:

> GOVERNMENT: Riyadh takes the diplomatic initiative
> ECONOMY: Saudi Arabia’s non-oil economy forges onward
> BANKING: Saudi banks work to keep pace with credit expansion
> UPSTREAM: Saudi oil and gas spending to surpass 2024 level
> DOWNSTREAM: Aramco’s recalibrated chemical goals reflect realism
> POWER: Saudi power sector enters busiest year
> WATER: Saudi water contracts set another annual record
> CONSTRUCTION: Reprioritisation underpins Saudi construction
> TRANSPORT: Riyadh pushes ahead with infrastructure development

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Indrajit Sen

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