National Oilwell Varco Inc. said Monday it has signed a memorandum of understanding with Saudi Aramco to form a joint venture in Saudi Arabia to build land rigs, rig and drilling equipment and offer aftermarket services. The JV will also create a center to train Saudis to maintain and operate the drilling equipment produced by the venture. National Oilwell will own a 70% interest in the JV, with Saudi Aramco owning the rest. The JV will be supported by a commitment from the Saudi Aramco Nabors Drilling company to buy 50 onshore drilling rigs over 10 years. "We are excited to bring together NOV's industry-leading technology, manufacturing expertise and rig products with Saudi Aramco's E&P capabilities," said National Oilwell Chief Executive Clay Williams. The stock, which was still inactive in premarket trade, has lost 7.0% year to date, while the VanEck Vectors Oil Services ETF has shed 16.1% and the S&P 500 has gained 6.4%.
Copyright © 2017 MarketWatch, Inc.
Continue Reading Below