ADNOC awards $1.83bn framework agreements for drilling-related services

Abu Dhabi National Oil Company (ADNOC) has awarded five framework agreements valued at $1.83bn (Dhs6.72bn) for directional drilling and logging while drilling (LWD) to expand production capacity of its low carbon oil and gas resources.

The framework agreements are the largest of such awards in the oil and gas industry and were awarded to Al Ghaith Oilfield Supplies and Services Company, Al Mansoori Directional Drilling Services, Schlumberger Middle East, Haliburton and Weatherford Bin Hamoodah Company, following a competitive tender process.

The awards cover ADNOC’s onshore and offshore fields and will run for five years with an option for another two years.

Over 75 per cent of the award value could flow back into the UAE economy under ADNOC’s In-Country Value programme over the duration of the agreements.

Yaser Saeed Almazrouei, ADNOC Upstream executive director, said: “As ADNOC responds to rising global energy demand, we are responsibly ramping up drilling activities to further unlock Abu Dhabi’s oil and gas resources which have some of the lowest carbon intensity in the world. These awards build on our ongoing investments in drilling services and they will deliver substantial in-country value for the nation to support economic growth and diversification, in line with the UAE Leadership’s wise directives.”

The framework agreement awards will support ADNOC’s requirement to drill thousands of new wells to expand its production capacity to five million barrels per day (mmbpd) by 2030, enable gas self-sufficiency for the UAE and remain a leading low-cost, low-carbon oil producer. The awards will also enable hundreds of millions of dollars in cost savings.

ADNOC is optimising its procurement approach to reflect market dynamics, focusing on long-term contracts with an optimal number of suppliers that provide stable and reliable delivery at highly competitive rates.

Since November 2021, ADNOC has awarded drilling agreements worth over $11bn (Dhs40.37bn) to top-tier contractors for wellheads and related components, downhole completion equipment and related services, liner hangers, cementing services, wireline logging and directional drilling. Directional drilling and logging while drilling entails controlling the direction and deviation of a wellbore while drilling to access oil and gas resources and measuring formation properties to enhance production.

In recent news, ADNOC awarded ADNOC Logistics & Services (ADNOC L&S) a $1.17bn (Dhs4.3bn) contract for the hire of 13 self-propelled jack-up barges. The barges will help drive offshore operational efficiencies and support the expansion of its crude oil production capacity to five million barrels per day (mmbpd) by 2030.

Read: ADNOC awards Dhs4.3bn contract to hire jack-up barges to boost offshore operations