Saudi Aramco IKTVA Program
Saudi Aramco: Confidential
“A thriving economy provides opportunity for all… we will develop our
investment tools to unlock our promising economic sectors, diversify our
economy and create job opportunities.” HRH Deputy Crown Prince Mohammed bin Salman
The Vision and Saudi Aramco’s Role
• Enable sustainable economy, supply chain and energy sector
• Double locally manufactured materials and services
• Create technical and professional jobs and careers
Saudi Jobs
70% Saudi Content
30% Exports
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Saudi Aramco: Confidential
Infrastructure Financial Support
Saudi Aramco Joint Ventures
iktva
Local Supply Chain
Microeconomic Fundamentals & Enablers
Ecosystem for Localization
3
Human Capital
Saudi Aramco
• Jazan Refinery
• EIC
• Maritime Yard …
Joint Ventures
• Sadara
• SATORP
• Yasref …
Anchor Projects and Engine Rooms for Growth
Saudi Aramco: Confidential
Infrastructure Financial Support
Saudi Aramco Joint Ventures
iktva
Local Supply Chain
Microeconomic Fundamentals & Enablers
Ecosystem for Localization
4
Human Capital
Infrastructure
• Ras Al-Khair
• Modon
• RCJY …
Human Capital
• NITI
• Maharat
• ITQAN …
Financial Support
• Wa’ed
• SAIIC
• SIDF …
Anchor Projects and Engine Rooms for Growth
Saudi Aramco: Confidential
Infrastructure Financial Support
Saudi Aramco Joint Ventures
iktva
Local Supply Chain
Microeconomic Fundamentals & Enablers
Anchor Projects and Engine Rooms for Growth
Ecosystem for Localization
5
Human Capital
Manufacturers
• Pipes
• Pumps
• Turbines …
Service Providers
• GIS
• MRO
• Laboratories …
Saudi Aramco: Confidential
Business Opportunities
Incentives (What’s in it for you?)
iktva – General Framework
6
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Saudi Aramco: Confidential
The In-Kingdom Total Value Add (iktva) Program
iktva is a program,
not a metric
iktva will work with
suppliers in a new
way for success
iktva is a Saudi
Aramco
Strategic
Imperative
Saudi Aramco vision is to enable a
globally competitive Saudi
Industrial Base
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Supplier IKTVA Formula
% iktva = 𝑨+𝑩+𝑪+𝑫
𝑬∗ 𝟏𝟎𝟎
DEFINITION
The IKTVA program
drives, measures and
monitors the “added-
value” brought to the
Kingdom by a supplier.
A. Localized goods and services ($)
B. Salaries paid to Saudis ($)
C. Training & Development of Saudis ($)
D. Supplier Development Spend ($)
E. In relation to revenue (spend from Saudi Aramco or the Kingdom)
Additional information:
• Number of Saudi Employees
• Investment ($)
• R&D spend ($)
• Exports ($)
Saudi Aramco: Confidential
Key Points about iktva
UNIFORM EVALUATION
FOR BOTH
Service Contractors
Materials Providers
SUPPLIER FOCUSED
Co-developed with
the suppliers
MUCH SIMPLER THAN
THE OTHER
INTERNATIONAL
PRACTICES
ASSESSMENT &
TRANSPARENCY
Validation by 3rd party
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Saudi Aramco: Confidential
How iktva Program Works
IKTVA is imbedded from start to finish
OPERATIONS
• Facilities Operation
• Field & Well
Services
PLANNING
• Design Basis Scoping
• Drilling Schedule
Development
• Services Schedule
Development
DESIGN
• FEED
• Requirements Master
Plan
• Scope design
CONSTRUCTION
• Detail Engineering,
Procurement, and
Construction
• Contract execution
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Saudi Aramco: Confidential
iktva engagement framework
Suppliers 5-Year Action Plans Process
Contract IKTVA Target = ZZ%
IKTVA Target Breakdown
o Local Goods & Services
o Saudi Compensation
o Saudi Training
o Local Supplier Development
CONTRACT (2)
CONTRACT (1)
CONTRACT (3)
IKTVA Contract SpendSuppliers 5-Year Action Plans Process
Baseline IKTVA Score = XX
2021 IKTVA Target = YY%
o Goods & Services: Expanding IK
manufacturing, and Sourcing
o Increase Saudization to XX%
o Supporting established training
schools and expanding their
training
o Develop IK suppliers
Supplier B
Supplier A
IKTVA Baselines & Plans
Supplier C
Supplier D
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IKTVA Baseline1 Monitoring4IKTVA Action
Plan2
Contract
Targets3
Evaluation
Commercial
Saudi Aramco: Confidential11
iktva toolbox
Included Excluded
Category A:
Goods & Services
• IK Manufactured Goods &
Services
• IK Operating & Admin
Expenses
• OOK Goods & Services
• Materials/Services
from Agents
• Capital Expenditures
Category B:
Compensation
Saudi Compensation:
• Salary & Bonus
• Housing
• Transportation
• Education Assistance
All Expat Base Salary &
Bonuses
Category C:
Training
Costs Associated With Saudi
Training
• Internships
• Scholarships
• Travel and Accommodations
• Course Fees
Training Costs Associated
With Expats
Category D:
Supplier
Development
All Cost Including Workforce,
Materials, Travel, …
Saudi Aramco: Confidential
Business Opportunities
Incentives (What’s in it for you?)
iktva – General Framework
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Saudi Aramco: Confidential13
Access to Information
Strategic Demand Forecasting (SDF)
Structured approach to collecting, analyzing, creating, and disseminating information to internal and external
stakeholders
10-Year CAPEX Expenditure
Building Blocks Breakdown
Aggregate and analyze
(G&S)
Total Labor Demand
Saudi Aramco: Confidential
Drilling Well Count
Average Spend / Year is $33 Billion
Capital program forecast
31%
11%42%
10%6%
Surface Facilities
Infrastructure
Drilling
UR
Other
$334 Billion
$330+ Billion of Opportunity in 10 Years
14
Disclaimer:
This presentation contains forward-looking statements regarding future events based on current expectations, estimates, forecasts, and projections. The presentation is
subject to updating, revision, further verification and amendment without notice. No reliance may be placed for any purpose on the information or opinions contained in this
presentation or any other document or statement, or on the completeness, accuracy or fairness of such information or opinions therein. No representation or warranty, express
or implied, is made or given by or on behalf of Saudi Aramco or its employees, or any other person as to the accuracy or completeness or fairness of the information or opinions
contained in this presentation and no responsibility or liability is accepted by any of them for such information or opinions or for any errors, omissions, misstatements,
negligent or otherwise, or for any communication written or otherwise, contained or referred to in this presentation.
2016 2020 2026
Saudi Aramco: Confidential
Drilling Materials – 10 Years Forecast $57 Billion
Quantities Examples
OCTG API, 11
Million units
Trees
20,000 units
Casing heads
15,000 units
Hanger
assemblies,
24,000 units
Cement
5.8 million Tons
Mud Products
(Liquid)
298 million
gallons
Percentage of Total Material Spend
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Saudi Aramco: Confidential
Rigs and Well Services – 10 Years Forecast $119 Billion
Rig Drilling Ops Services = $60 BWell Services Total Spend = $59 B
136
84
4330
3
OnshoreOil
OnshoreGas
OffshoreOil
UR OffshoreGas
Average Rig Count/Year
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Saudi Aramco: Confidential
Average Spend / Year is $33 Billion
Capital program forecast
31%
11%42%
10%6%
Surface Facilities
Infrastructure
Drilling
UR
Other
$334 Billion
$330+ Billion of Opportunity in 10 Years
17
Disclaimer:
This presentation contains forward-looking statements regarding future events based on current expectations, estimates, forecasts, and projections. The presentation is
subject to updating, revision, further verification and amendment without notice. No reliance may be placed for any purpose on the information or opinions contained in this
presentation or any other document or statement, or on the completeness, accuracy or fairness of such information or opinions therein. No representation or warranty, express
or implied, is made or given by or on behalf of Saudi Aramco or its employees, or any other person as to the accuracy or completeness or fairness of the information or opinions
contained in this presentation and no responsibility or liability is accepted by any of them for such information or opinions or for any errors, omissions, misstatements,
negligent or otherwise, or for any communication written or otherwise, contained or referred to in this presentation.
Surface Facilities
0.5
3
9
10
19
24
29
39
Renewables
Power
Pipelines
Oil Facilities
Other
Gas Facilities
Refining & Petrochem
Maintain Potential
Saudi Aramco: Confidential
Examples of Surface Facilities Materials 10 Years Forecast
0 1 2 3 4 5 6 7 8 9 10
CABLE, Low V, 56,420 KM
PUMPS CS, 3,789 Units
BOILER PLANT EQUIP, 185 Units
STORAGE TANKS, 1177 Tanks
AIR COOOLERS, 554 Units
STAINLESS STEEL PIPING (SS314/316), 135,348 Tons
CONCRETE, 20205 Cubic Meters
COMPRESSORS, 514 Units
OTHER EQUIPMENT, 2000 Items
PROCESS VESSELS SS, 800 Units
CONTROL VALVES, 86000 Units
STRUCTURAL STEEL, 734000 Tons
FIELD INSTR, ANALYZERS, GAGES - 66000 Units
CARBON STEEL FITTINGS & VALVES - 15.8 Million Units
STAINLESS STEEL FITTINGS & VALVES - 5.7 Million Units
HEAT EXCHANGERS - 4300 Units
CARBON STEEL PIPING - 3.1 Million Tons
PROCESS VESSELS CS - 6000 Units
Surface Facilities Materials
$56 Billion
Surface Facilities
Construction
$75 Billion
Thousands
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Saudi Aramco: Confidential
Manpower 10 Year Forecast
* This demand is for industrial projects only. It does not include
Commercial, Residential, or Infrastructure Projects.** Inclusive of all disciplines
DRILLING AVERAGE MANPOWER/YEAR*
SKILL LEVEL EXAMPLES
PROCESS FACILITIES AVERAGE MANPOWER/YEAR*
SKILL LEVEL EXAMPLES
Saudi Aramco: Confidential20
National Specialized Training Centres
Operating Facilities (11 Centers)
• Eleven active training centers to support jobs creation and training with total capacity of 10,800 trainees
• Today a total of 6,304 trainees are sponsored in training centers
• New companies started to join new training centers as founding stakeholders such as: drilling companies,
power companies and construction companies
• Will continue to add more specialized training centers reaching 25 centers with total capacity of 42,000
trainees by 2030
Saudi Aramco: Confidential21
More Opportunities – Metal Conversion Ecosystem
Conversion Industries Castings
Forgings
Heat Treatment
Precision Machining :
o Tooling Engineers
o Design Engineers
o QC/QA
o Machinists
o Industrial Engineers
o Maintenance/Ops
Coating
Testing
Cascading Support
Industries CAD/CAM
Cutting Tools/Fluids
Training Academy
MRO
Tool & Jig Repair
Regrind Operation
Critical Support Facilities Laboratories
Recycle and Reclamation
Facilities
Product Certifications
Hydrostatic Testing
Destructive & ND Testing
In Kingdom Total Value Add Implemented Natural Resource
Raw Materials
Iron ores
hematite (Fe2O3)
or magnetite
(Fe3O4).
About 98% of world
iron ore production
is used to make
iron in the form of
steel.
Nickel
Copper
Steel Making
The process for
producing steel from
iron ore and scrap.
Steel Products
Coils -----SSAW, ERW
Pipes
Plates ----LSAW Pipes
Billets ----Seamless Pipe
Ingots ----Casting
Carbon, Stainless & Alloy
Steel Types
Resource Education, Training and Development
(OEM) Finished goods
Downhole / Rig
equipment
Static Equipment :
Pressure vessels
Heat Exchangers
Pipe
Pipe Fittings
Rotating Equipment :
Pumps
Turbines
Compressors
Saudi Aramco: Confidential
Business Opportunities
Incentives (What’s in it for you?)
iktva – General Framework
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Saudi Aramco: Confidential23
Incentives – What’s in it for You?
• Saudi Aramco incentives:
– Significant potential - Saudi Aramco continues to build capacity
– Long-term corporate purchase agreements
– Premium allowance for local manufacturers
– Exclusivity to local manufacturers in certain sectors
– IKTVA based market share and business allocation
• Saudi Arabia additional incentives:
– Favorable foreign investment laws
– Young educated population
– Low cost energy & industrial land
– Industrial loans on favorable terms (SIDF)
– Financial support from Human Resources Development Fund (HRDF)
– Saudi Arabian General Investment Authority (SAGIA)
Saudi Aramco: Confidential
www.iktva.sa
Comprehensive information on iktva program
Business Opportunities
3rd Party Certifiers
Centralized iktva submission gateway
FAQ
24
iktva Website
Saudi Aramco: Confidential25
Takeaway Messages
WIN – WIN PROPOSITION
SIGNIFICANT OPPORTUNITIES LIE AHEAD
EXCELLENT SUPPORT FROM KEY STAKEHOLDERS
IS A MUST HAVE PROGRAM FOR DOING BUSINESS WITH SAUDI ARAMCO
Saudi Aramco: Confidential26
Thank You