ADNOC Drilling secures $1.7 billion contract to unlock UAE’s unconventional energy resources

ADNOC Drilling has been awarded, by ADNOC, a $1.7 billion contract to provide drilling and associated services for the recovery of unconventional energy resources. The contract will see Turnwell deliver 144 unconventional oil and gas wells. 

Unconventional energy refers to oil and gas resources trapped in subsurface reservoirs requiring additional technology and processes to unlock them.

Abu Dhabi today holds an estimated 220 billion barrels of unconventional oil and 460 trillion cubic feet (Tcf) of unconventional gas in place.

To service the contract, and explore the considerable future opportunities in unconventional resources, ADNOC Drilling has inaugurated a new company, Turnwell Industries. The new company will be primarily engaged in unconventional drilling operations.

Commenting on the announcement, Abdulrahman Abdulla Al Seiari, Chief Executive Officer of ADNOC Drilling, highlighted, "Abu Dhabi’s unconventional energy resources are among the world’s largest. This award, for 144 wells is just the beginning.”

Meanwhile, ADNOC Drilling has signed a term sheet to enter into a strategic partnership with Schlumberger Middle East SA and Patterson-UTI International Holdings subject to signing definitive agreements and any necessary regulatory approvals.

Abdulmunim Saif Al Kindy, ADNOC Upstream Executive Director and Vice Chairman of ADNOC Drilling, said, ”our goal at ADNOC is to provide the energy and energy products that people depend on every day to power their lives and ensure a just, orderly, and equitable energy transition. This award will accelerate the development of Abu Dhabi’s world-class resources to meet the world’s growing demand for affordable, accessible energy.”

Leveraging technology

Spearheading unconventional energy drilling development within the Middle East region and securing the UAE’s unconventional energy needs and resources, ADNOC Drilling will leverage cutting-edge innovations in AI smart drilling design, completions engineering, and production solutions.

This will be supported by ADNOC Drilling’s recent joint venture with Alpha Dhabi, Enersol, which will see its scalable technology ecosystem bolstered through investments in AI-enabled solutions and innovative technologies. 

This initial phase of unconventional development is expected to employ up to nine land rigs, of which five are already included in ADNOC Drilling’s fleet as of 31 December 2023.

The contract is expected to start contributing to ADNOC Drilling’s revenue towards the second half of this year. The company’s full-year 2024 and mid-term guidance only captures this initial award, creating significant potential upside to our business and financials in the mid to long-term.