Saudi Arabia turns to Halliburton for its fracking needs

Mohammed bin Salman, heir to the throne of Saudi Arabia, capped a three-week U.S. tour in Houston, where the crown prince and an entourage of Saudi and American oil executives inked new deals to study multibillion-dollar U.S. projects. less Mohammed bin Salman, heir to the throne of Saudi Arabia, capped a three-week U.S. tour in Houston, where the crown prince and an entourage of Saudi and American oil executives inked new deals to study ... more Photo: Mark Wilson, MBR / TNS Photo: Mark Wilson, MBR / TNS Image 1 of / 40 Caption Close Saudi Arabia turns to Halliburton for its fracking needs 1 / 40 Back to Gallery

Saudi Arabia will partner with Houston-based Halliburton as it hopes to unlock a natural gas revolution similar to the shale boom that began in the U.S. more than a decade ago.

State oil company Saudi Aramco signed a three-year contract Sunday with the North American fracking leader to handle the hydraulic fracturing and completions of its unconventional gas wells. Saudi Arabia hopes to rely much more on its domestic gas to power the Kingdom's electric grid.

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Whiles Saudi Arabia is known as the world's largest oil exporter, it has vast supplies of gas as well, but much of it is difficult to recover from shale rock and tight sand. The goal is to use the unconventional drilling and fracking technologies developed in the U.S., especially in Texas, to tap into those gas resources.

The effort also is part of Saudi Arabia's "Vision 2030" modernization plans to open Saudi's energy sector to foreign investors, including taking Aramco public eventually, while diversifying globally, especially along the Texas Gulf Coast. Saudi Arabia is increasingly investing in Texas petrochemical plants and refineries from Corpus Christi to Port Arthur.

The deal comes just a month after Crown Prince Mohammed bin Salman, the heir to the Saudi throne, capped a three-week U.S. tour in Houston, where he underscored the Kingdom's long-standing energy ties to the region.

Now, Halliburton is a bigger part of those overall plans.

"We believe Halliburton will work best with Saudi Aramco to help in our pursuit of unconventional gas to serve domestic needs, offset local crude burning, provide feedstock for chemical industry development, and spur regional economic development in line with Vision 2030, the Kingdom's national transformation program," said Mohammed Qahtani, Saudi Aramco's senior vice president of upstream.

The contract includes a guaranteed two years with the option for a one-year extension. The companies declined to dollar figures or additional details about the deal for now.

"We are excited to apply our broad knowledge, efficiency and experience in unconventionals from Halliburton's leadership position in North America to Saudi Arabia," said Halliburton Chief Executive Jeff Miller, who traveled to Saudi Arabia for a signing ceremony. "This is a great opportunity to provide a tailored application of Halliburton technology, logistics management and operational excellence to maximize Saudi Aramco's asset value and deliver optimal recovery."