In a strategic move to bolster the presence of national companies in mega-projects, Mohammed Hadi Al-Rasheed & Partners announced the signing of a major contract with the National Oil Technology Company (Nasr) to supply high-quality silica sand. The five-year contract is valued at over SAR 1.1 billion, and the vital material will be used in unconventional gas extraction operations at the giant Jafurah field.
Contract details and financial impact
According to a statement published on the Saudi Stock Exchange (Tadawul) website, this agreement follows the successful securing of a contract by Nesr, a leading oilfield services provider in the Middle East and North Africa, to complete hydraulic fracturing and gas extraction services at the Jafurah field. Al-Rashid expects the positive financial impact of this contract to begin appearing in its financial statements starting from the first quarter of 2026, reflecting the sustainability of its cash flows and future growth.
Jafurah Field: A Cornerstone of Future Energy
This contract is of paramount importance due to its direct connection to the Jafurah field project, the largest unconventional (shale gas) field in Saudi Arabia. The field spans a vast area and contains enormous reserves estimated at approximately 200 trillion cubic feet of gas. Developing this field is a cornerstone of Saudi Aramco's strategy to increase gas production, aiming to meet growing domestic energy demand, provide feedstock for the petrochemical sector, and support the Kingdom's ambitions to become a major exporter of blue hydrogen.
The importance of silica in hydraulic fracturing processes
Silica sand is an essential component of hydraulic fracturing technology used to extract unconventional gas. This sand is pumped at high pressure into wells to keep rock fractures open, allowing gas to flow. This contract underscores the quality of the Kingdom's mineral resources, as Saudi Arabia possesses substantial reserves of high-purity silica sand, reducing reliance on imports and strengthening domestic supply chains.
Alignment with the Kingdom's Vision 2030
This partnership aligns perfectly with the goals of Saudi Vision 2030, which aims to make the mining sector the third pillar of national industry. The agreement also reflects the major companies' commitment to the In-Kingdom Total Value Add (IKTVA) program, by relying on local suppliers and localizing industries that support the energy sector, thereby contributing to job creation and boosting GDP.
