Saipem has secured a $500 million contract from Saudi Aramco for engineering, procurement, construction, and installation (EPCI) work to further expand the giant Safaniyah offshore oilfield. Safaniyah is the world's largest offshore field, producing about 1.3 million barrels per day, and requires ongoing investment to maintain output.

Scope of Work and Project Details

The contract involves the EPCI of a 48-inch diameter trunkline, with 65 kilometres offshore and 12 kilometres onshore, along with associated subsea facilities. Offshore operations will be executed by Saipem's regional vessels, while fabrication will occur at its Saipem Taqa Al-Rushaid Fabricators yard in Dammam, Saudi Arabia.

Contract Framework and Market Context

This award falls under Aramco's Long Term Agreement (LTA) framework with offshore contractors. While the specific Contract Release and Purchase Order (CRPO) number was not disclosed, sources indicate Saipem secured one of several CRPOs, including numbers 154, 155, 156, 161, 163, and 164, expected to be awarded soon. This follows two other offshore contracts Saipem won from Aramco in December, identified as CRPOs 162 and 165.

The LTA market has averaged $2-3 billion annually but has seen increased activity in 2025, driven by multibillion-dollar contracts for Aramco's Zuluf field project. Saipem has been a major beneficiary of the LTA framework recently. Company leadership has characterized the framework as robust and continuous, primarily involving the replacement, upgrade, or installation of new pipelines to enhance production or replace aging infrastructure.

Aramco's Strategic Focus

The award aligns with Aramco's long-term capital expenditure strategy, which emphasizes heavy spending on upstream projects, particularly gas-based developments, to maintain its position as the world's largest oil exporter.