ADNOC Drilling confirms $2bn contract award for Ghasha mega project

ADNOC Drilling Company has confirmed the award of contracts worth $2bn to enable the delivery of ADNOC’s Ghasha offshore mega gas project.

The contracts are valued at $1.3bn for Integrated Drilling Services(IDS) and $700m for the provision of four island drilling units. It will be supporting acceleration of ADNOC Drilling’s medium-term revenue and earnings growth at very attractive margins.

Each contract has a fixed term of ten years, with the IDS portion of the award adding $40m per year to the Company’s previous Oilfield Services revenue guidance.

We’ve awarded contracts worth $2 billion to ADNOC Drilling to progress the Ghasha Concession, the world’s largest offshore sour gas development. As we deliver gas growth, the awards show the expertise within #ADNOC to deliver complex projects while generating in-country value.

— ADNOC Group (@AdnocGroup) July 27, 2022

The Ghasha project is the world’s largest offshore sour gas development and plays a key role in ADNOC’s plans to meet growing domestic and international demand for gas, as well as enabling gas self-sufficiency for the UAE. Production from the concession is expected to start around 2025, ramping up to produce more than 1.5 billion standard cubic feet per day before the end of the decade.

The awards reinforce ADNOC Drilling’s unique role as the sole provider of drilling services to ADNOC. Up to 46 wells can be drilled from a single artificial island, minimising the project’s environmental footprint.

Abdulrahman Abdullah Al Seiari, CEO of ADNOC Drilling said, “This  award will ensure we continuously deliver strong and sustained growth while further driving shareholder value. Our status as a key enabler of ADNOC’s production capacity expansion targets, offer investors a solid opportunity for sustained and predictable revenue growth, coupled with market leading cash flows and profitability margins, resulting in a progressive dividend policy.”

Since ADNOC Drilling launched its IDS offering in 2018, the Company has delivered more than $250m in savings for its customers through the delivery of start-to-finish wells.

In other news, recently, ADNOC Logistics & Services (ADNOC L&S), the shipping and maritime logistics arm of Abu Dhabi National Oil Company (ADNOC), has announced that it is acquiring Zakher Marine International (ZMI), an Abu Dhabi-based owner and operator of offshore support vessels, with the world’s largest fleet of self-propelled jack-up barges.

Read: Abu Dhabi’s ADNOC L&S acquires Zakher Marine International