ADNOC incorporates new company to service $1.7 billion unconventional energy contract
ADNOC has awarded ADNOC Drilling Company a $1.7 billion contract to provide drilling and associated services for the recovery of unconventional energy resources. To service the contract and explore the considerable future opportunities in unconventional resources, ADNOC Drilling has incorporated a new company, Turnwell Industries. The contract will see Turnwell deliver 144 unconventional oil and gas wells.
In addition, ADNOC Drilling has signed a term sheet to enter into a strategic partnership with Schlumberger Middle East and Patterson-UTI, subject to signing definitive agreements and any necessary regulatory approvals.
“This award will accelerate the development of Abu Dhabi’s world-class resources to meet the world’s growing demand for affordable, accessible energy,” said Abdulmunim Saif Al Kindy, ADNOC Upstream Executive Director and Vice Chairman of ADNOC Drilling. “ADNOC Drilling is perfectly placed to responsibly develop these resources. Utilizing partnerships, innovative AI, digitalization and advanced technologies, we will unlock Abu Dhabi’s abundant energy resources, to drive value for the UAE.”
“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,” said Abdulrahman Abdulla Al Seiari, Chief Executive Officer, ADNOC Drilling.
He continued: ‘’It represents a significant expansion of our operations and specialist capabilities and to help us with that, we have set up a new company called Turnwell, and have signed a term sheet with SLB and Patterson-UTI, for potential partnership and support with the latest technology, specialist services and innovations in the unconventional energy drilling space subject to signing definitive agreements and any necessary regulatory approvals.”
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 enabled by ADNOC Drilling’s recent joint venture with Alpha Dhabi, Enersol, which will see its scalable technology ecosystem bolstered through investments in – and acquisitions of – AI-enabled solutions and innovative technologies.
This initial phase of unconventionals 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.
Abu Dhabi holds an estimated 220 billion barrels of unconventional oil and 460 TCF of unconventional gas in place. The opportunity in unconventional energy presents outstanding scale with the production potential comparable to some of the most plentiful unconventional energy resources in the US.
