UAE's ADNOC awards $946 mil contract to maintain output at Umm Shaif field

Abu Dhabi National Oil Co. has awarded a $946 million contract to maintain output at offshore Umm Shaif field as part of plans to hit an oil production capacity of 5 million b/d by 2030 from about 4 million b/d currently.

The UAE's National Petroleum Construction Co., which won the engineering, procurement and construction contract after a competitive tender process, will work to maintain Umm Shaif's 275,000 b/d production capacity and boost its long-term potential, ADNOC said in a Jan. 5 statement. The epc contract, which is due to be completed in 2025, includes two packages for network expansion and new well-head towers.

"This contract is an important contributor to ADNOC Offshore's plans as we build our production capacity to over 2 million barrels a day in the coming years in support of ADNOC's smart growth strategy," Ahmad al-Suwaidi, CEO of ADNOC Offshore, said in the statement.

Higher capex

ADNOC is forging ahead with an expansion of its hydrocarbons and low-carbon businesses under a plan to spend Dirham 466 billion ($127 billion) over 2022-2026. That is higher than the last five-year capex plan, which was Dirham 448 billion.

ADNOC in 2021 also announced an increase in national reserves of 4 billion stock tank barrels of oil and 16 Tcf of natural gas, bringing the UAE's hydrocarbon reserves base to 111 billion barrels of oil and 289 Tcf of gas.

Around half of the newly added 4 billion barrels of oil is Murban-grade crude, which has been trading on the ICE Futures Abu Dhabi commodities exchange since March.

The capex spending will allow ADNOC to expand its upstream production capacity and downstream portfolio as well as its low carbon fuels business and clean energy ambitions, the company said at the time.