Schlumberger to remain in Pakistan despite merger with Saudi TAQA: Petroleum Ministry

KARACHI: Schlumberger Ltd, a Texas-based drilling company, will remain in Pakistan despite its onshore drilling rigs business acquired by Arabian Drilling Company (ADC), a subsidiary of  Saudi Arabia’s Industrialization and Energy Services Company (TAQA), for $415 million (SAR 1.56 billion), officials confirm.
TAQA on Sunday announced that its drilling subsidiary, ADC, has agreed to acquire Schlumberger’s Middle East onshore drilling rigs business in Kuwait, Oman, Iraq and Pakistan as part of its planned $1.2 billion acquisitions of drilling rig ventures.
“It has been reported that it is a simple merger but Schlumberger will remain in Pakistan”, Sher Afghan Khan, Spokesman of Pakistan’s Petroleum Division, told Arab News.
Through this expansion, ADC will become an industry powerhouse, operating a superior fleet of 58 onshore rigs and 9 offshore rigs across the Middle East and North Africa (MENA) region. The combined firm will have more than 5,900 employees and builds on ADC’s long-standing reputation of reliably serving national and international oil and gas companies for over 55 years, statement posted on TAQA official website says.
The transaction will combine the outstanding track records of the parties with respect to operations, quality of service, health, safety and environment. It will also create economies of scale and cost synergies, making ADC a regional leader, encompassing a diversified, multi-country and multi-client offering.
“This acquisition is fully aligned with Saudi Vision 2030. It unlocks value and drives growth across our entire value chain through a more integrated regional approach, while positioning a leading Saudi company as a global player,” TAQA chief executive officer Azzam Shalabi, who is also chairman of the ADC Board was quoted as saying in an interview at Dammam, Saudi Arabia.
Taqa plans to use about $800 million of its own funds for the planned acquisitions and may seek loans or sell bonds or sukuk for the rest, Shalabi said. It may consider an initial public offering in 2021, according to the website post.
As the transaction is expected to close in the second half of 2019, subject to regulatory approvals, the officials hope that it will benefit all stakeholders. “We look forward to supporting ADC in the next phase of its expansion and have full confidence that this will benefit all stakeholders, most notably our regional clients,” Shalabi added.
Schlumberger, provides technology for reservoir characterization, drilling, production, and processing to the oil and gas industry. reported revenues of $32.82 billion in 2018. The company reported $2,338 million revenue generation from Middle East & Asia region during January- March 2019, which is two percent higher as compared to the same period last year.