Offshore Rigs: Back On Track

Research evidence excerpt

Offshore Rigs: Back On Track

Update

July 12, 2026 10:57 PM GMT

Morgan Stanley & Co. International plc+MArabian Drilling Co | Europe Ricardo Rezende, CFA

Equity Analyst

Offshore Rigs: Back On Track Ricardo.Rezende@morganstanley.comGiulia Faro +44 20 7677-9886

Research Associate

Giulia.Faro@morganstanley.com +44 20 7425-7581

Key Takeaways Sylvia C Richards

Three suspended offshore rigs will resume in 2H26, with utilization reaching Sylvia.Richards@morganstanley.com +44 20 7677-3354

100% by year-end.

Arabian Drilling Co (2381.SE, ARABIAND AB)

Resumptions are positive and de-risk the equity story, in-line with our base case EEMEA - Oil & Gas | Saudi Arabia

of a 3Q start and full utilization by year-end. Stock Rating Overweight

Industry View No Rating

Resumptions reduce top-line downside and should support margins in 2H; Price target SAR 107.00

Shr price, close (Jul 12, 2026) SAR 92.30

potential new contracts remain a key catalyst. 52-Week Range SAR 107.00- 72.15

Mkt cap, curr (mn) SAR 8,215

Net debt (12/26e) (mn)* SAR 2,310

Bottom-line: positive. Despite not presenting upside to our base case (we assumed

EV, curr (mn)* SAR 10,657

resumptions starting in 3Q with full utilization by year end), restarting the

* = GAAP or approximated based on GAAP

suspended rigs is an important de-risking factor for Arabian Drilling's equity story.

Not only it reduces the downside risk on top-line, but the gradual resumption of

suspended rigs should also imply that margins will inflect positively in the coming

quarters. Post resumptions, we see potential new contracts as an important catalyst

for Arabian Drilling.

What happened? On Sunday morning Arabian Drilling announced that it has

received resumption notice for three offshore rigs suspended earlier in 2026.