In the wave of global energy transition and a surge in computing power, the "second growth curve" for Yantai Jereh Oilfield Services Group Co.,Ltd. (Jereh), a leading Chinese private oilfield service company, is rapidly materializing.
On the evening of February 1st, Jereh announced that its wholly-owned subsidiary, GenSystems Power Solutions LLC (GPS), successfully signed a sales contract for gas turbine generator sets with a certain US customer, amounting to $181.5 million (approximately 1.265 billion yuan).
This marks the fourth major gas turbine order the company has secured in the North American market since November 2025, signaling the continuous expansion of its high-end power market network in the region.
Progressing from initial market testing to the current surge in orders, Jereh is precisely addressing the power supply pain points of data centers 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 pressure from order fulfillment and risks associated with foreign exchange fluctuations.
According to the latest announcement, this newly signed $181.5 million contract is the fourth sales contract for gas turbine generator sets signed with a US customer since November 2025, with the counterparty being the third new client the company has recently collaborated with in the United States.
Looking back over the past few months, Jereh's pace of securing orders has been enviable; just half a month prior, on January 14th, the company announced signing a $106 million (approximately 742 million yuan) sales contract with another US customer, which was a repeat order from the same client, bringing the cumulative contract value with this customer to $212 million, accounting for about 11.11% of the company's audited operating revenue for 2024.
The core driver behind this series of orders for 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, which offers flexibility, stability, and low emissions, has become the preferred choice to fill power gaps and ensure grid stability.
The key to Jereh's repeated success in winning over high-end North American clients lies in its products' precise alignment with the specific needs of data center power supply scenarios. The announcement indicates that the gas turbine generator sets sold will be used in data center power supply, designed with a core philosophy of "rapid assembly/disassembly and flexible relocation." They feature a highly integrated design enabling quick transportation, on-site assembly, and flexible capacity expansion, and when paired with emission reduction solutions, can lower nitrogen oxide emissions during operation, meeting the high-load, high-reliability, and low-emission requirements of data center power usage.
Furthermore, Jereh's deep supply chain integration capabilities provide a solid foundation for its overseas expansion. During an investor relations event on January 30th, Jereh revealed that the company focuses on building a globalized supply chain system and has established long-term, stable cooperative relationships with gas turbine manufacturers such as Siemens, Baker Hughes, and Kawasaki Heavy Industries, covering multiple models of gas turbines.
Notably, in October 2025, the company completed bulk procurement arrangements for Kawasaki gas turbines and signed a strategic cooperation agreement. Jereh stated, "Leveraging this strategic cooperation as a pivot point, the company will continuously introduce and integrate global high-quality technical resources, continuously enhance supply chain resilience, and provide customers with integrated comprehensive power solutions."
Although the order values continue to hit new highs, the execution cycle for this latest 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 order disclosed on the evening of February 1st has been extended to 30 months. This means revenue recognition for this contract will span a longer timeframe, which, while securing the company's fundamental performance base for the next two and a half years, also significantly increases uncertainties during execution.
A delivery window stretching two and a half years means the company must directly confront multiple external risks, including changes in the macroeconomic environment, policy shifts, and foreign exchange fluctuations.
"During the contract execution process, factors such as changes in the macroeconomic environment, policies, market conditions, and exchange rate fluctuations may affect the execution of the contract and the recognition of revenue, leading to uncertainties," Jereh highlighted as risks.
It is worth noting that to hedge against risks associated with long cycles, Jereh has established relatively strict "firewalls" in the payment terms. The announcement shows that after contract signing, the customer will pay a certain proportion as a down payment, with the remaining payments made according to the contract schedule, and the full amount settled before equipment shipment.
Facing the delivery pressure brought by the surge in orders, Jereh is accelerating capacity expansion. During the January 30th investor exchange event, Jereh indicated that regarding delivery capability, the company 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 Jereh facility and increasing local recruitment efforts to strengthen supply chain resilience and delivery response speed.
Furthermore, during an investor exchange event on January 7th, Jereh made similar statements: regarding capacity, the company, through expansion based on the original US Jereh facility, now possesses production capacity for the final assembly of various equipment types, including electric drive/turbine fracturing sets and gas turbine power generation equipment, capable of meeting production demands for related products in North America; concurrently, domestic and international capacities can be mutually adjusted, and the company will reasonably plan and utilize domestic and international capacity based on actual order situations to strengthen delivery capabilities.
Notably, regarding the future outlook for the company's power generation business segment, 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 project 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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