US energy giants poised to pour $60 billion into UAE oil & gas projects

UAE-headquartered Abu Dhabi National Oil Company (ADNOC) has strengthened its energy bonds with U.S. energy majors, thanks to deals to ramp up oil and gas production capacity at two giant fields.

The deepening of energy ties with U.S. companies, which was disclosed during the UAE-U.S. business dialogue with President Donald Trump, has the potential to enable $60 billion of U.S. investments in the UAE energy arena across the projects’ lifespan. On the other hand, the enterprise value of UAE energy investments into the U.S. is set to reach $440 billion by 2035, as part of the Middle Eastern country’s $1.4 trillion investment plan into the American energy sector.

Dr. Sultan Al Jaber, UAE’s Minister of Industry and Advanced Technology, ADNOC’s Managing Director and Group CEO, highlighted: “The deep-rooted bilateral relationship between the UAE and the US is underpinned by our shared commitment to enabling energy abundance and we are reinforcing this commitment through these agreements with US energy majors.

“We see significant opportunities for further UAE-US partnerships across the energy-AI nexus and we look forward to working with our American partners to unlock long-term sustainable value and drive socioeconomic progress.”

The set of agreements ADNOC secured with U.S. players encompasses a field development plan with ExxonMobil and Japan’s Inpex to expand the capacity of Abu Dhabi’s Upper Zakum offshore field through a phased development to sustainably grow production capacity and help meet rising global demand with low-carbon intensity barrels. Recently, ADNOC Drilling was tasked with supplying three island rigs to support the expansion of the same oil field.

Furthermore, ADNOC has signed a strategic collaboration agreement with Occidental to look into ways to increase the production capacity of the Shah gas field to 1.85 billion standard cubic feet per day (bscfd) of natural gas, from 1.45 bscfd, and accelerate the deployment of advanced technologies at the field.

This gas field, perceived to be one of the world’s largest of its kind, is located 180 kilometers southwest of Abu Dhabi. The potential expansion of the facility will provide more gas for domestic industrial growth and liquefied natural gas (LNG) for export. 

Moreover, the U.S. is considered a top priority market for XRG, ADNOC’s energy investment arm, which recently joined Petronas and Turkmenistan’s Hazarnebit and Turkmennebit in a block in the Caspian Sea. XRG is set to boost investments across the American energy value chain, focusing on expanding gas, LNG, specialty chemicals, and energy infrastructure.

To this end, the company has inked a framework agreement with Occidental’s subsidiary, 1PointFive, to evaluate a potential investment in a direct air capture (DAC) project in Kleberg County, Texas. This project will remove up to 500,000 tons of CO₂ per year using commercial-scale DAC technology, with XRG considering a capital commitment of up to one-third of the project’s total development cost.

Aside from these deals, Abu Dhabi’s Supreme Council for Financial and Economic Affairs (SCFEA) has granted a new unconventional oil exploration concession for onshore Block 3 to EOG Resources, a U.S.-based hydrocarbon exploration and production company. This block covers a 3,609 square kilometer area within the Al Dhafra region of Abu Dhabi.

ADNOC, which will oversee and assist with exploration activities in the concession and has the option to join a subsequent production concession, claims the award is the first of its kind for a U.S. company, which underlines the attractiveness of Abu Dhabi’s energy sector and its position as a trusted investment destination.

“The agreements reinforce the shared commitment of the UAE and US to maintaining global energy security and the stability of energy markets,” emphasized the United Arab Emirates’ energy giant.