UAE player investing in drilling growth with $658 million in new awards
UAE’s Abu Dhabi National Oil Company (ADNOC) has awarded framework agreements valued at $658 million for cementing services as it continues to invest to enable drilling growth and expand its crude oil production capacity.
Following a competitive tender process, the framework agreements were awarded to Haliburton, Baker Middle East, Emirates Western Oil Well Drilling & Maintenance, NESR Energy Services, and Emjel Oil Field Services,
These awards cover ADNOC’s onshore and offshore fields and will run for five years with an option for a further two years. Furthermore, skilled employment opportunities will be created for UAE Nationals by successful companies who will also work to identify local manufacturing opportunities.
According to ADNOC’s statement on Thursday, the smart nature of the awards will enable it to realize hundreds of millions of dollars in cost savings. As an integral part of its 2030 strategy, ADNOC is optimizing its procurement strategy to reflect market dynamics, focusing on long-term contracts with an optimized number of suppliers that provide stable and reliable delivery at highly competitive rates.
Yaser Saeed Almazrouei, ADNOC Upstream Executive Director, said: “The awards for cementing services will support the ongoing expansion of ADNOC’s drilling activities as we grow our production capacity, strengthening our position as a reliable global supplier of some of the world’s most carbon-efficient barrels.”
Cementing is an important step in the drilling and completion of oil and gas wells. It involves mixing together cement slurry, additives and water and pumping the mixture between the rock formation and well casing to protect and seal the wellbore.
The award for cementing services takes the total value of ADNOC’s drilling-related framework agreements and procurement awards since November 2021 to over $8.5 billion. These awards will support ADNOC’s requirement to drill thousands of new wells as it increases its crude oil production capacity to five million barrels per day (mmbpd) by 2030 and drives gas self-sufficiency for the UAE.
As a reminder, ADNOC in January 2022 awarded a $946 million engineering, procurement, and construction (EPC) contract for the strategic long-term development of its Umm Shaif field to compatriot National Petroleum Construction Company (NPCC). The investment supports its oil production capacity plans.
Come February 2022 and another investment in drilling-related equipment and services was revealed with ADNOC awarding framework agreements to four oilfield services providers valued at $1.94 billion to enable drilling growth in its operations.
In other related news, ADNOC earlier this week revoked the suspension of Petrofac imposed about a year ago and reinstated Petrofac in its commercial directory. Pursuant to this reinstatement, Petrofac is allowed to participate in all ADNOC’s upcoming new tenders with immediate effect.