Landmark Supply Pact With Energy Giant

On May 26, 2025, Arabian Pipes Company, one of Saudi Arabia’s leading welded steel pipe manufacturers, signed a significant supply contract valued at SAR104 million ($27.7 million) with Saudi Aramco. The agreement marks another chapter in the ongoing collaboration between domestic infrastructure players and the global oil behemoth. The contract covers the supply of specialized welded steel pipes that are integral to Saudi Aramco’s vast oil & gas pipeline network.

Reinforcing National Industrial Backbone

Arabian Pipes has long been pivotal in supporting Saudi Arabia’s industrial ambitions, especially in the energy and construction sectors. This new contract comes at a time when the Kingdom is intensifying efforts under its Vision 2030 initiative to rely more on local manufacturing. With this deal, the company underscores its position as a domestic champion capable of matching global standards in pipe fabrication and supply logistics.

Technical Excellence and Production Capacities

The pipes to be supplied under this deal will likely come from Arabian Pipes’ two key facilities, one in Riyadh with a production capacity of 160,000 metric tons annually, and the other in Jubail Industrial City with a smaller but specialized output of 300 metric tons per year. These factories produce a variety of high-performance pipes, including Longitudinal Submerged-Arc Welded and Electric Resistance Welded types, suited for high-pressure and structural applications.

Steady Flow of Aramco Contracts

This is not the first time Arabian Pipes has secured deals with Saudi Aramco. Over the past twelve months, the company has inked multiple high-value contracts with the oil giant, including two earlier ones worth SAR107 million ($28.5 million) each. These repetitive deals indicate a strong mutual confidence between the two firms and reinforce Arabian Pipes’ strategic alignment with Saudi Aramco’s long-term procurement framework.

Financial Performance and Projections

Arabian Pipes reported a quarterly profit of SAR40.17 million ($10.7 million) for the first quarter of 2025, despite lower overall revenue compared to previous periods. Analysts believe that recurring high-value contracts such as this latest deal with Aramco could offer financial stability and improve forward earnings. The company’s earlier full-year profit for 2024 stood at SAR168.18 million ($44.8 million), demonstrating strong fundamentals despite macroeconomic headwinds.

Regulatory Endorsement and Capital Strategies

In late April 2025, Saudi regulators approved a capital increase for Arabian Pipes, which signals broader institutional trust in its operational strategies. The company also granted one bonus share for every three held, as part of a shareholder reward mechanism. Furthermore, the Saudi Exchange initiated a stock split to enhance liquidity and attract retail investors, all of which are expected to positively impact the firm’s investment profile.

National & Global Pipeline Significance

Steel pipes are essential to both hydrocarbon extraction and transportation in Saudi Arabia, which remains one of the world’s largest oil exporters. By ensuring a reliable domestic source like Arabian Pipes, Saudi Aramco mitigates potential geopolitical supply chain risks. Additionally, the partnership allows Arabian Pipes to enhance its global competitiveness and technical prowess in welded pipe manufacturing.

Key Takeaways

• Arabian Pipes signed a $27.7 million supply contract with Saudi Aramco for welded steel pipes.

• The company operates two major plants with a combined capacity of over 160,000 metric tons annually.

• Despite stock volatility, recurring contracts and capital initiatives reflect strong long-term prospects.