iktva Forum 2020

Your Royal Highnesses, Your Excellencies, Distinguished Guests: good morning … and thank you for joining us.

We are deeply honored that His Royal Highness, the Amir of the Eastern Province, Prince Saud bin Naif bin Abdulaziz, can be with us once again. We are also delighted that His Royal Highness, Prince Abdulaziz bin Salman, the Minister for Energy, has joined us today.

The support of our suppliers means a lot to Saudi Aramco.

As you know, we take great pride in our low-cost production and our reputation for reliability. A first-class supply chain is a critical factor that makes both possible.

Indeed, the importance of our supply chain was reinforced after the attacks on our facilities last September. The attackers tried to cripple us and hurt the global economy.

What they underestimated … and what the world came to appreciate … was the resilience of Aramco and the determination of our people.

As the smoke was still rising above Abqaiq and Khurais … we were bringing in materials, equipment and services to accelerate recovery.

Thanks to iktva … more of this than ever, was available locally.

As a result, we restored production more quickly and at a lower cost than most expected. I thank all who assisted.

As for iktva overall, its success is reflected in the numbers. For the first time, the majority of our procurement is from in-Kingdom … 56% to be exact.

Our suppliers have tripled their local purchases of goods and services. There has been a 13-fold increase in spending by our main suppliers in developing local sub-suppliers.

Our suppliers are now investing three times the amount on R&D in the Kingdom. Their employment of Saudis is up 50%. And female employment has increased by almost a third. Our suppliers are exporting 50 percent more from the Kingdom … because of iktva.

But these impressive numbers only tell part of the story.

There has also been progress on several anchor projects that will deliver an industrial ecosystem.

Projects like an integrated steel plate manufacturing facility … and the JV between Saudi Aramco, Hyundai Heavy Industries and Dussur to manufacture marine engines and pumps in the Kingdom. Such investment has one primary purpose: to create a highly efficient, cost-effective and reliable supply chain.

A supply chain that helps keep costs down through economies of scale and also creates financial efficiencies. A supply chain where there is faster turnaround for maintenance and for new projects.

Now, meeting our 70% goal will be challenging.  But we are counting on all of you to contribute and to continue to deliver. Let me point out that we see four factors to greater iktva achievement.

First, there needs to be a place where manufacturers can locate their operations … which is where the King Salman Energy Park comes in.

Second, developing a high-quality workforce is essential … which is why 16 vocational training institutions have been opened in the Kingdom.

Third, we recognize we are operating in an increasingly carbon-conscious world … which is why we, along with our suppliers, must take into account ESG considerations.

The fourth factor is the most important ... iktva is only sustainable if it provides benefits to all involved. New business and market share and good returns for our suppliers. Efficiency, cost and reliability gains for Saudi Aramco.

Plus industrialization, economic diversification and employment benefits for the Kingdom. 

So iktva must continue to open new doors of opportunity.

By enhancing the business environment for young Saudis … for entrepreneurs ... and for businesses, big and small.

In the end, the best measurement of iktva and what counts is how much positive impact all of us can have on people's lives.

That's iktva in action.

Thank you.