Introduction
Saipem is a leading global contractor in engineering, drilling and construction services for the energy industry. Headquartered in Italy, the company has a strong presence in over 60 countries across 5 continents. Saipem is a subsidiary of Italian energy company Eni and specializes in designing and delivering large-scale offshore and onshore projects. With advanced fleet, execution capabilities and technologies, Saipem provides end-to-end solutions across the oil, gas and renewables value chains. This article provides an overview of Saipem including its history, key business segments, major projects, financial performance and future outlook.
History
The origins of Saipem date back to the 1950s when eni created a pipeline department to manage its growing hydrocarbon infrastructure. This was expanded into Saipem in 1957 as a subsidiary focused on engineering and construction of pipelines and related facilities.
Over the next few decades, Saipem grew internationally through new market entry and strategic acquisitions. Some key milestones include:
- 1962: Established operations in West Africa for onshore pipelines
- 1971: Offshore engineering and construction debut in the North Sea
- 1987: Entered the Middle East market
- 2002: Expanded in West Africa through acquisition of Bouygues Offshore
By the 1990s, Saipem had become a turnkey contractor for complex offshore projects. It diversified into offshore drilling in 1987 through the acquisition of Perforadora Central. This allowed Saipem to provide fully integrated EPC (engineering, procurement, construction) solutions.
Today Saipem is a global E&C leader in the energy industry with advanced capabilities across both traditional and new energy sources.
Main Business Segments
Saipem operates across two main business segments:
- Engineering & Construction: Provides onshore and offshore EPC services for pipelines, complexes and offshore platforms across oil, gas, LNG, and renewables.
- Drilling: Owns and operates a large offshore drilling fleet including ultra-deepwater drillships and semi-submersible rigs. Provides well construction and engineering services.
The company owns a vast equipment fleet including pipelay, lifting and accommodation vessels as well as onshore construction machinery. Saipem leverages its local execution hubs and specialized workforce across projects.
Notable Projects
With 60+ years of experience, Saipem has delivered over 5000 projects around the world. Some landmark projects include:
- The Trans-Mediterranean natural gas pipeline from Algeria to Italy
- Sakhalin-2 offshore platforms and export pipelines in Russia
- Pearl GTL plant – world’s largest gas to liquids complex in Qatar
- Wheatstone and Ichthys LNG projects in Australia
- Multiple ultra-deepwater field developments in Brazil
- Kaombo oil project offshore Angola
- Shah Deniz 2 platform and pipelines in Azerbaijan
Saipem is currently working on several offshore wind projects, including Dogger Bank in the UK, which will be the largest in the world upon completion.
Financial Performance
Saipem reported revenues of €6.7 billion in 2021, reflecting a recovery from the pandemic-led industry downturn. However, rising costs and project charges led to a net loss of over €2 billion. The company continues to face challenges from low visibility, cost inflation and supply chain disruptions.
As part of a strategic reorganization, Saipem is focusing on high value businesses, optimizing its operating model and strengthening its balance sheet. The company maintains a solid backlog of €22.5 billion which provides revenue visibility. Saipem is targeting improved profitability and cash flow generation going forward.
Future Outlook
Saipem sees opportunities across its legacy oil and gas markets as well as growing renewables and green technologies. It expects major liquefaction and offshore wind projects to drive growth over the coming decade. Saipem’s early positioning in floating offshore wind gives it a competitive edge.
Geographically, the Middle East, North Sea and Americas will be key markets. Saipem is also expanding its presence in Asia Pacific, East Africa and Russia. Furthermore, the company aims to leverage its E&C expertise to diversify into sectors like infrastructure.
While industry volatility persists, Saipem’s integrated offerings, execution track record and advanced capabilities position it strongly to benefit from the new energy transition.
Conclusion
Saipem has renowned capabilities and long-standing expertise as a full-service contractor in the energy industry. Despite recent financial challenges, its strategic reorganization and extensive backlog provide growth visibility. As the energy mix evolves, Saipem is well placed to capitalize on traditional hydrocarbons as well as new frontiers like offshore wind. Its engineering strengths, technologies and global footprint make Saipem a leading player in the energy services sector.