Made in Saudi: Driving quality companywide, Kingdomwide through localization
‘Seeing the ‘Made in Saudi’ tag more frequently is something to be very proud of, especially when you know your team helps in making this happen.’
Setting a target of channeling 70% of Aramco’s total purchasing from local vendors, manufacturers, and service providers, was an ambitious goal. But today, the company’s In-Kingdom Total Value Add (iktva) program has taken root in its everyday operations. Paired with the Kingdom’s 2030 Vision for economic development, Aramco’s iktva program has made dramatic headway encouraging the manufacturing of critical components, many of them never before produced in the Kingdom.
For Aramco, localization simply makes good business sense. Aramco is a main consumer of industrial assets Kingdomwide, and the way it makes purchase decisions to meet its own needs can have a profound effect on the Kingdom’s economy.
Seeing the ‘Made in Saudi’ tag more frequently is something to be very proud of, especially when you know your team helps in making this happen.
— Abdullah S. Al Humaid, manager of the Consulting Services Department (CSD)
As the company’s main organization for specialized engineering services and quality consultations, the CSD is supporting the Industrial Development and Strategic Supply Department in promoting localization, particularly in sourcing for technical areas such as electrical, mechanical, rotating equipment, and nonmetallic applications.
Aligned with iktva’s principles, the Sourcing and Business Development team identifies gaps in the local supply chain for critical equipment, and encourages both local and foreign service providers and manufacturers to invest and produce that equipment in the Kingdom. CSD plays a major role by supporting these new vendors with due diligence assessments, providing them with technical guidance, and identifying corrective actions to enhance the quality and performance of the developed products. Aramco thereby benefits by obtaining the equipment it needs, when it needs it, with reduced downtime.
Considering the impact of localization on the operational process at Aramco, we can start with the flow of electric power to the facility. The power utility typically generates electricity and supplies Aramco facilities, adding to the electricity that Aramco generates on its own through co-generation.
The power then flows to transformers that lower the voltage to levels utilized within the facility. In Aramco’s Marjan project, 36 of these huge transformers are now being constructed locally, and the testing of these transformers are being witnessed and certified by a newly developed and recognized local third-party testing agency.
The power then flows through switchgears inside substation buildings. Switchgears have long been assembled in the Kingdom, but now, the heart of these devices, the vacuum circuit breakers, are being produced locally. A local facility is currently building a 10,000 horsepower induction motor for one of Aramco’s facilities, a sign that the Kingdom’s manufacturing expertise is expanding to ever-more complex equipment.
Moving further within the production process, pipelines and valves are a critical aspect within the product flow control. Based on this, the high-pressure gate valves for the high integrity pressure protection systems are being locally manufactured, as well as the high-pressure severe service needle choke valves used in oil wells’ production lines. Also, butterfly valves, which are considered one of the most commonly used valve types in the industry, due to its lightweight and compact size, are also being manufactured locally.
These significant localization achievements are helping to promote the Saudi heavy industry.
“What we see now is that many of these major assets that used to be imported from all around the world, are being built here in the Kingdom,” said Rami M. Dabbousi, a senior engineering consultant with CSD.
Caption: Thanks to Aramco’s iktva agreement with vendors, this injection compressor for a gas reservoir storage project is now produced in Kingdom, helping to strengthen the Saudi economy.