Aramco pushes supply chain localization in Saudi Arabia with six new manufacturing MoUs

Saudi Aramco, otherwise known as the Saudi Arabian Oil Company, has announced that it has expanded its In-Kingdom Total Value Add (IKTVA) localization program with the signing of six new Memoranda of Understanding (MoUs).

The development includes plans to forge new international partnerships, boost domestic produce, and breathe new life into local supply chains in a variety of sectors, including 3D printing.

Amin H. Nasser, President and CEO of Aramco, states: “Today’s announcement is a step change in Aramco’s pioneering IKTVA program which was launched in 2015. Despite the uncertainties surrounding the global economy, we have sustained our focus on our long-term goals to enable growth and development for a thriving ecosystem and a more diversified Saudi economy.”

Saudi Aramco, officially the Saudi Arabian Oil Company, is one of the largest corporations in the world by revenue. Photo via Aramco.
Saudi Aramco, officially the Saudi Arabian Oil Company, is one of the largest corporations in the world by revenue. Photo via Aramco.

The IKTVA localization program

According to Aramco, the company has a long history of supporting the Kingdom’s domestic business sphere. The IKTVA program is one of the products of this commitment, drawing business to the local area and increasing employment opportunities for the Saudi people. Since the program’s launch, Aramco’s local content index has reportedly increased from 35% in 2015 to 56% in 2020.

Ahmad Al-Saadi, Senior Vice President of Technical Services at Aramco, adds: “Our planned partnerships will continue this journey and advance the Kingdom’s economic progress. We intend to act as an enabler, supporting the growth of national champions. Today we are expanding our flagship program, and expect more partnerships in the future.”

Six new MoUs

Of the six new MoUs, the agreement with Chinese 3D printer OEM Suzhou XDM involves collaborating on the development and propagation of new industrial laser-based powder bed fusion systems in Saudi Arabia. While the region is not known for its heavy use of additive manufacturing technology, Aramco has hopes that the partnership will change this, and push fresh talent towards realizing the potential of 3D printing.

The other five MoUs comprise strategic partnerships with energy venture Shell & AMG Recycling, Shen Gong New Materials, sensor manufacturer Xinfoo, tech firm SUPCON, and steelmaker POSCO. Aramco has stated plans to launch new businesses with these companies in their respective sectors, which include steel plate manufacturing, energy management, digital equipment manufacturing, catalyst manufacturing, and advanced smart chip manufacturing.

Nasser explains: “These new partnerships will contribute to advancing innovation, sustainability and enhance the scale of reliability in our business ecosystem and, in addition, benefit companies operating in the Kingdom’s vast energy and chemicals sector. These partnerships will also have a strong focus on new technologies, by maximizing our investments in non-metallic materials and the circular carbon economy, as well as the development of talented Saudis in communities where we operate.”

XDM specializes in metal SLM 3D printers such as this XDM 250. Photo via XDM.
XDM specializes in metal SLM 3D printers such as this XDM 250. Photo via XDM.

Earlier this year, Oklahoma-based precision machining company Duncan Machine Products announced plans to 3D print oil and gas components using metal 3D printing technology from Californian OEM VELO3D. As a major supplier to the energy and aerospace industries, Duncan will use metal additive manufacturing to improve both part performance and reduce lead times for its customers.

More recently, energy industry consortium DNV GL completed two Joint Innovation Projects (JIPs) establishing guidelines for the production and qualification of 3D printed parts for the oil and gas and maritime industries. The projects involved two years of work and contributions from 20 major partners, including BP, Shell, and SLM Solutions.

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Featured image shows an Aramco facility and employee. Photo via Aramco.