ADNOC Drilling secures $1.7bn contract for unconventional energy resources

ADNOC Drilling Company PJSC has been awarded a $1.7 billion contract by the Abu Dhabi National Oil Company (ADNOC) to provide drilling and associated services for the recovery of unconventional energy resources. This contract will see Turnwell Industries LLC, a newly formed subsidiary of ADNOC Drilling, deliver 144 unconventional oil and gas wells.

Key Points

– $1.7 Billion Contract: ADNOC Drilling secures a substantial contract from ADNOC.

– Turnwell Industries LLC: New subsidiary formed to handle unconventional drilling operations.

– Strategic Partnerships: Term sheet signed with Schlumberger Middle East and Patterson-UTI International.

– Resource Estimates: Abu Dhabi holds an estimated 220 billion barrels of unconventional oil and 460 trillion cubic feet of unconventional gas.

ADNOC Drilling secures a $1.7 billion contract from ADNOC to extract unconventional energy resources.

To execute the contract and explore future opportunities in unconventional resources, ADNOC Drilling has established Turnwell Industries LLC. The new company will be responsible for delivering the unconventional oil and gas wells and will primarily focus on unconventional drilling operations.

ADNOC Drilling has also signed a term sheet to form a strategic partnership with Schlumberger Middle East, a subsidiary of SLB, and Patterson-UTI International. This partnership is contingent upon the signing of definitive agreements and obtaining necessary regulatory approvals. Both Schlumberger Middle East and Patterson-UTI are expected to hold minority equity interests in Turnwell Industries. In exchange for their equity interest, Patterson-UTI will provide drilling, completion, and other oilfield service expertise to Turnwell Industries, along with a limited cash contribution for working capital.

Expanding Unconventional Energy Resources

Abu Dhabi’s unconventional energy resources are among the largest globally. According to ADNOC Drilling, the UAE’s capital currently has an estimated 220 billion barrels of unconventional oil and 460 trillion cubic feet of unconventional gas. The initial phase of unconventional resource development is expected to utilize up to nine land rigs, five of which are already part of ADNOC Drilling’s fleet as of December 31, 2023.

Abdulrahman Abdulla Al Seiari, CEO of ADNOC Drilling, commented on the significance of this contract: “Abu Dhabi’s unconventional energy resources are among the world’s largest. This award for 144 wells is just the beginning. It represents a transformational opportunity for ADNOC Drilling as the UAE’s world-class unconventional energy resources will require many thousands more wells, and we are in a prime position to deliver them.”

The contract is anticipated to begin contributing to ADNOC Drilling’s revenue in the second half of this year. The company will utilize innovations in artificial intelligence (AI) powered smart drilling design, completions engineering, and production solutions. This initiative is supported by Enersol, ADNOC Drilling’s recent joint venture with Alpha Dhabi. Enersol will enhance its scalable technology ecosystem through investments in and acquisitions of AI-enabled solutions and innovative technologies.

The $1.7 billion contract awarded to ADNOC Drilling signifies a major advancement in the extraction of unconventional energy resources in the UAE. The formation of Turnwell Industries LLC and the strategic partnerships with Schlumberger Middle East and Patterson-UTI International highlight ADNOC Drilling’s commitment to leveraging cutting-edge technologies and expertise to maximize resource recovery.

The integration of AI-powered solutions and innovative drilling techniques positions ADNOC Drilling at the forefront of the industry, ensuring efficient and effective operations. As the global demand for unconventional energy resources continues to grow, ADNOC Drilling’s strategic initiatives and collaborations will be crucial in meeting these demands and driving the company’s long-term success.