Adnoc awards $1.5bn drilling contract to expand offshore capacity in the emirate

Abu Dhabi National Oil Company (Adnoc) has awarded a $1.53 billion contract to Adnoc Drilling, aimed at expanding the production potential of its offshore fields.

The operator said in a statement on Monday that the two-year contract “covers the provision of 12 jack-up rigs and two island rigs and the associated Integrated Drilling Services (IDS).

“This award will leverage ADNOC Drilling’s start-to-finish offering as well as its position as the largest drilling company in the region by rig fleet size to drive value and efficiencies while minimizing environmental impact”, the operator said.

Adnoc noted that the new contract award supports the expansion of its "crude oil production capacity to 5 million barrels per day (bpd) by 2030 and gas self-sufficiency for the UAE."

There are growing suggestions among multiple Gulf State sources that Adnoc will fast-track these ramp-up plans to reach the 5 million bpd target by 2025, led by market fundamentals and an assessment of limited spare capacity of leading producers in the region.

A formal announcement on advancing its production capacity target is yet to be made by the company, and it officially still maintains a target of 5 million bpd capacity by 2030.

The Abu Dhabi giant has also unveiled a $127 billion capital expenditure plan for 2022-2026, as it embarks on multiple offshore oil & gas expansion projects.

Yaser Saeed Almazrouei, Adnoc’s upstream executive director said that through the recent award, the company “will continue to responsibly harness the energy in Abu Dhabi’s waters, as it increases production capacity to meet the world’s growing demand for energy with lower carbon intensity oil and gas”.

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