In the global wave of energy structure transformation and a computing power explosion, the "second growth curve" of China's leading private oilfield service company, Yantai Jereh Oilfield Services Group Co.,Ltd. (002353.SZ), is rapidly materializing.
On the evening of February 1st, Yantai Jereh announced that its wholly-owned subsidiary, GenSystems Power Solutions LLC (GPS), successfully signed a sales contract for gas turbine generator sets with a US customer, amounting to $181.5 million (approximately RMB 1.265 billion).
This marks the company's fourth major gas turbine order secured in the North American market since November 2025, signaling the continuous expansion of its network within the high-end North American power market.
Progressing from initial market testing to a current surge in orders, Yantai Jereh is precisely addressing the pain points of data center power supply with its modular design featuring "rapid assembly/disassembly and flexible relocation," swiftly carving out a niche in the global power gap. However, the company also faces challenges related to order fulfillment pressure and exchange rate fluctuation risks.
Notably, since the beginning of this year, Yantai Jereh's stock price has accumulated a gain of nearly 30%.
This newly signed $181.5 million contract represents the fourth gas turbine generator set sales agreement the company has signed with US customers since November 2025, with the counterparty being the third US client the company has recently collaborated with.
Reviewing the past few months, Yantai Jereh's order acquisition pace has been impressive: just half a month prior, on January 14th, the company announced signing a $106 million (approximately RMB 742 million) sales contract with another US client. This order constituted a repeat purchase from the same customer, bringing their cumulative contract value to $212 million, accounting for approximately 11.11% of the company's audited operating revenue for 2024.
The core driver behind this series of orders for Yantai Jereh stems from the urgent global demand for reliable power supply from data centers. With the explosive growth in AI computing power demand, natural gas power generation—combining flexibility, stability, and low emissions—has become the preferred choice to fill power gaps and ensure grid stability.
The key to Yantai Jereh's repeated success in winning over high-end North American clients lies in its products' precise alignment with the specific requirements of data center power supply scenarios. The announcement indicates that the gas turbine generator sets sold under this contract will be used for data center power supply. They are designed with a core philosophy of "rapid assembly/disassembly and flexible relocation," employ a highly integrated design for quick transportation, on-site assembly, and flexible capacity expansion, and are paired with emission reduction solutions to lower nitrogen oxide emissions during operation, meeting the high-load, high-reliability, and low-emission demands of data center power usage.
Furthermore, Yantai Jereh's deep supply chain integration capabilities provide a solid foundation for its overseas expansion. During an investor relations activity on January 30th, the company revealed that it focuses on building a globalized supply chain system. For gas turbine supply, it has established long-term, stable cooperative relationships with manufacturers such as Siemens, Baker Hughes, and Kawasaki Heavy Industries, covering multiple gas turbine models.
Particularly in October 2025, the company completed bulk procurement arrangements for Kawasaki gas turbines and signed a strategic cooperation agreement. Yantai Jereh stated, "Leveraging this strategic cooperation as a pivot, the company will continue to introduce and integrate global high-quality technical resources, continuously enhance supply chain resilience, and provide customers with integrated comprehensive power solutions."
Although the order value continues to hit new highs, the execution cycle for this particular order differs significantly from previous ones.
Compared to the "delivery within 13 months after contract生效" mentioned in the January 14th announcement, the delivery period for the $181.5 million contract disclosed on February 1st is extended to 30 months. This means revenue recognition for this contract will span a longer timeframe. While it secures the company's fundamental performance baseline for the next two and a half years, it also substantially increases uncertainties during the execution process.
A delivery window stretching two and a half years necessitates that the company must directly confront multiple external risks, including changes in the macroeconomic environment, policy shifts, and exchange rate fluctuations.
"During the contract execution process, it may be affected by factors such as changes in the macroeconomic environment, policy changes, market changes, and exchange rate fluctuations, leading to uncertainties in the contract's execution and revenue recognition," Yantai Jereh highlighted as a risk.
It is worth noting that to hedge against risks associated with long cycles, Yantai Jereh has established relatively strict "firewalls" in the payment terms. The announcement shows that after the contract is signed, the customer will pay a certain proportion as an advance payment, with the remaining payments made according to the contract schedule, and the full amount settled before the equipment is shipped.
Facing the delivery pressure from the surge in orders, Yantai Jereh is accelerating capacity expansion. During the January 30th investor exchange, the company stated that regarding delivery capability, it is actively promoting the construction of its gas turbine supply system and has established strategic cooperative relationships with several renowned gas turbine manufacturers. Simultaneously, it is expanding capacity at its US facility and increasing local recruitment efforts to strengthen supply chain resilience and delivery response speed.
Furthermore, during an investor exchange on January 7th, Yantai Jereh made similar statements: regarding capacity, the company, through expansions based on its existing US facility, now possesses production capabilities for the final assembly of various equipment types, including electric drive/turbine fracturing sets and gas turbine power generation equipment, meeting production demands for related products in North America. Additionally, the company's domestic and overseas capacities can be mutually adjusted; it will reasonably plan and utilize domestic and overseas capacity based on actual order situations to strengthen delivery capabilities.
Regarding the future outlook for the company's power generation business segment, Yantai Jereh mentioned that going forward, the company will continue to deepen its efforts in three main sectors: data centers, industrial energy, and new power systems. By continuously enhancing technological innovation, product iteration, and engineering delivery capabilities, it aims to promote the intelligent and large-scale application of clean energy equipment and engage in comprehensive collaboration with customers in areas such as data center power supply and distribution systems.
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